"Pakistan Agribusiness Report Q4 2013" now available at Fast Market Research

High input costs and a lack of much-needed investment in essential infrastructure, coupled with inefficient and inconsistent government intervention, will prove to be the key dampeners for the agribusiness sector in Pakistan. We see all the key segments in the sector - wheat, rice and cotton - being victim of this unsupportive operating environment and forecast only a muted 3.0% year-on-year increase in the value of the agribusiness sector between 2013 and 2017. Given that the sector accounted for more than 21% of the country's total GDP during 2012 (according to BMI estimates), it is imperative that the new government increases its focus on policies that will help to improve its overall competitiveness and provide incentives for increased production.

Full Report Details at
- http://www.fastmr.com/prod/670584_pakistan_agribusiness_report_q4_2013.aspx?afid=301

Key Forecasts

* Sugar consumption growth to 2017: 14.3%, to 5.0mn tonnes. Demand, boosted by growth in population and incomes, will fall just short of supply throughout the forecast period.
* Rice production growth to 2016/17: 4.8%, to 6.5mn tonnes. Production growth will be sluggish, as demand for Pakistani exports stutters and domestic consumption remains low.
* 2013 real GDP growth: 3.9%. Up from 3.7% year-on-year (y-o-y) in 2012.
* Consumer price inflation: 12.4% average in 2013 (up from 11% y-o-y in 2012).
* BMI universe agribusiness market value: US$43.1bn in 2013 (down from US$43.2bn in 2012; forecast to grow annually by 1.7% on average to 2017).

Key Revisions to Forecasts

Rice production for 2012/13 revised down to 5.6mn tonnes (compared with a previous estimate of 6.7mn tonnes). Local reports have suggested that the damage caused by floods in the Sindh province was more severe than expected.

Wheat production for 2012/13 revised down to 24.0mn tonnes (compared with a previous forecast of 24.5mn tonnes). The government's decision to raise the procurement price has reportedly failed to lure farmers to increase acreage. Farmers reportedly consider the new procurement price of PKR1,200 per 40kg (up from PKR1,050 per 40kg) to be insufficient to offset the overall increase in their input prices.

Industry Developments

Pakistan's rice exports continue to be restrained by high export prices when compared to other major Asian exporters. Rice exports in the first seven months of the current 2012 fiscal year (July 2012 - June 2013) reached 1.6mn tonnes, down 16.8% y-o-y, according to the Pakistan Bureau of Statistics. Export value is down 5.6% y-o-y so far, at US$1.1mn. Regarding basmati rice, which has traditionally reaped higher prices, the Pakistani variety trades at a premium over India's, due to tight domestic supply. Much of this loss can be attributed to progressive declines in the production of basmati rice, the result of producers shifting to the cultivation of hybrid rice varieties, which fetch higher yields and require shorter cultivation periods.

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