Pakistan Food Security Bulletin Issue 5 (Period: July December 2016) January, 2017

Transcription

1 Issue 5 (Period: July December 2016) January, 2017 The Pakistan Food Security Bulletin is produced by the Vulnerability Analysis and Mapping (VAM) Unit of the World Food Programme as a contribution to periodic food security monitoring in the country. Highlights Total national wheat crop production for was reported at 25.6 million MT, slightly higher than the level of 25.1 million MT, showing a positive growth of 2.18 percent. Production of rice, the second main staple crop of Pakistan, has been estimated at 6.9 million MT (milled basis), reflecting a lower production by 1.47 percent compared to the 7.0 million MT of During the reporting period, staple food prices slightly increased, while the prices of all non cereal food commodities significantly decreased, except cooking oil that negligibly increased. The fuel prices slightly increased for both Super Petrol and HSD from June Term of Trade (ToT) decreased by 2.8 percent from June 2016 due to increased wheat flour price. Continued progress has been noted in the return of displaced populations in FATA, with some 66,400 families have returned to their areas of origin during the reporting period, reaching a total of 227,000 families during the period of March 2015 December However, 76,507 families are still remained in displacement, whereas the Government has announced an extension to compete the return by December Situation Overview In , wheat (main staple) harvest in Pakistan stood at million MT, slightly higher than the level of 25.1 million MT, showing a positive growth of 2.18 percent. While for production of rice, the second main staple crop of Pakistan, has been estimated at million MT (milled basis), slightly less than the previous year s production of 7.0 million MT by 1.47 percent. Currently, 22 percent of the total population of Pakistan (or million people) are reported to be undernourished, mainly attributed to limited economic access to food which remains the main constraint of household food security. According to FAO s recent report, the proportion of undernourished people in Pakistan has decreased by 13 percent in compared to levels 4. The latest reestimation by the Ministry of Planning, Development and Reform indicates that 30 percent of population would be considered poor based on new Pakistan s poverty line and Household Integrated Economic Survey ( ) 5. Over the past six months, stable fuel and food prices, with slight fluctuations and few exceptional increases, have somewhat eased the hardships of the highly vulnerable population. With improvement in the law and order situation across the country, a significant number of displaced populations have been returning to FATA, with some 227,000 families reported to have returned as of December Among them, 66,400 6 families returned during the second half of 2016; however, 76,500 7 families are still in displacement. In addition, the coastal areas of Balochistan and western parts of Sindh, the Potohar plateau (i.e. Islamabad and its surrounding areas such as Rawat, Gujar Khan, Taxila, Attock and Rawalpindi) that solely rely on rain fed agriculture, have been mostly affected by slow crop growth due to unusual high temperatures and a dry spell during the peak wheat sowing months in October November 2016, which is forecasted to yield less than 50 percent of the normal level of wheat output. This would raise vulnerabilities of the small holders and poor households until the second crop (Kharif) harvest in Economic Wing of Ministry of National Food Security & Research, Government of Pakistan. December Economic Survey of Pakistan, Ministry of Finance, Government of Pakistan. 3 The State of Food Insecurity in the World, FAO, Asia and the Pacific Regional Overview of Food Insecurity, Investing in a Zero Hunger Generation ; FAO Poverty in Pakistan: Raising the bar ; Ministry of Planning, Development and Reform, April Government (including FDMA, RRU, CLCP), UNHCR, WFP, OCHA Pakistan. 9 January Government (including FDMA, RRU, CLCP), UNHCR, WFP, OCHA Pakistan. 9 January 2017.

2 Crop and Livestock Production Situation Crop situation Pakistan is an agricultural country. The sector contributed 19.8 percent in gross domestic product (GDP) and it remains by far the largest employer, absorbing 42.3 percent of the country s total labor force. The agriculture sector growth is contingent on favorable weather conditions. There is a strong relationship between agriculture and climate temperature, precipitation, floods and other weather conditions that affect economic performance including agriculture production, commodity prices and economic growth 8. Pakistan has two cropping seasons 9, "Kharif" and Rabi. The agriculture sector recorded a negative growth of 0.19 percent in the year Since crops consist of over 37 percent of the total agriculture production, the current negative growth of agriculture sector is mainly due to the 6.25 percent negative growth of crops. Wheat production For wheat major Rabi crop the final production for has been recorded at million MT and was grown on an estimated area of 9,224 thousand hectares which is close to the target set by the Federal Committee on Agriculture and recorded a positive growth of 2.18 percent. The wheat support price has been maintained from the preceding year at PKR 1,300/40 kg aiming at providing an incentive to farmers to grow more wheat and achieve production targets. However, significant geographic disparities in wheat production exist across the country. Slightly more than three quarters of the national cereal production comes from Punjab, followed by Sindh, Khyber Pakhtunkhwa and Balochistan (Figure 1). Figure 1: Wheat production by province ( ) Sindh 15% KPK Balochistan 6% 3% Punjab 76% Punjab Sindh KPK Balochistan For , wheat crop planting was completed by December. The wheat crop production forecast is at million MT. However, it is uncertain at this stage whether this target could be achieved due to long dry spell of over 100 days, resulting in a likely decreased in cultivated areas this year of 9,120 thousand hectares. Rice production Rice is Pakistan's second most important staple and third largest crop in terms of area sown, after wheat and cotton. It accounts for 3.1 percent in the value added in agriculture and 0.6 percent of GDP. Figure 2 presents the share of the national rice production by province in Figure 2 : Rice production by province ( ) 38% The latest rice production projection in December 2016 for is at million MT from an estimated area of 2,800 thousand hectares, indicating a slight decline of 1.47 percent from last year s record production of 7.0 million MT. Punjab and Sindh produced more than 88 percent of total rice production. The decrease in rice cultivated area is likely attributed to decreased economic returns to farmers on account of declined rice prices both domestically and globally during last year. Depressed prices and rising costs of production encouraged farmers to substitute rice with fodder and maize. In addition, the heavy downpours in July 2015 also affected paddy cultivation. Livestock production 2% 9% Livestock is an important sub sector of agriculture in Pakistan. Nearly 8 million families are engaged in livestock production and earn more than 35 percent of their income from this activity. It is often the only source of income for the rural and most marginalized people in case of calamity, and thus, has a great potential for poverty alleviation and fetch foreign exchange for 51% Punjab Sind KP Baluchistan 8 Pakistan Economic Survey Ministry of Finance, Government of Pakistan. 9 Pakistan has two cropping seasons, "Kharif" being the first sowing season starting from May June and harvesting takes place during October December. Rice, sugarcane, cotton, maize, pulses (moong, mash), millet (bajra) and sorghum (jowar) are major Kharif s crops. "Rabi" season, the second sowing season, begins from October December and harvesting takes place during April May. Wheat, gram, lentil (masoor), tobacco, rapeseed, barley and mustard are major "Rabi" crops. 10 Economic Wing of Ministry of National Food Security & Research, Government of Pakistan. 11 GIEWS, Country Briefs (30 Nov 2016), FAO. 12 USDA, Foreign Agricultural Service. Issue 5 January 2017 Page 2 of 6

3 the country. In , livestock accounts for 58.6 percent of the value added in overall agriculture, and 11.6 percent of GDP, similar to last year (11.7 percent) 13. Major livestock products are milk and meat. During , the gross production of milk and meat increased by 3.2 percent and 3.7 percent, respectively, compared to Markets and Food Prices During the reporting period (July Dec 2016), the market prices in Pakistan remained stable. Prices of cereals (wheat, wheat flour, rice Irri 6 and Basmati) slightly increased with the lowest prices recorded during the harvest months. In contrast, the prices of all non cereal food commodities significantly decreased, except cooking oil that negligibly increased. Staple prices (wheat, wheat flour, rice Irri 6 and Basmati) Prices of staples (wheat and wheat flour) remained stable with slight fluctuations during the reporting period. Figure 3 shows a Year on Year (YoY) percent change in the staple prices at three different points (December 2015, June 2016, and December 2016). In December 2016, compared to June 2016, the prices of wheat and wheat flour slightly increased by 5.9 percent and 4.1 percent, respectively. The highest price of wheat and wheat flour was reported at PKR 35.1 and PKR 39.8 per kg, respectively, in December Whereas, the lowest price of wheat and wheat flour was recorded at PKR 33.6 per kg and PKR 38.6 per kg, respectively, in July 2016, mainly due to increased supply of both commodities in the market post wheat harvest season. 10.0% 5.0% 0.0% 5.0% 10.0% 15.0% 20.0% Figure 3: Year on Year change in price of staple cereals Wheat Wheat Flour Irri 6 Basmati On a one year comparison with December 2015, the price of Irri 6 increased by 8.5 percent, while that of Basmati negligibly increased by 0.4 percent 14. Prices of non cereal food commodities (chicken, pulses, sugar, cooking oil) Figure 4 shows that the prices of the majority of the commodities were significantly decreased, except cooking oil. Price decreases were noted for pulses Dal Mash (by 22.1 percent), Dal Moong (15 percent), lentil Dal Masoor (7.4 percent), live chicken (17.8 percent), and sugar (1.9%) in December 2016 compared to June Meanwhile, the price of cooking oil negligibly increased by 0.5 percent. On a one year comparison with December 2015, the price of pulse Dal Mash significantly decreased by 14.4 percent in December Significant fluctuations were observed in the price of poultry and its products, however, these variations were mostly seasonal. The prices of live chicken, pulse Dal Moong, and cooking oil were recorded lower by 9.4 percent, 15.9 percent, and 0.9 percent, respectively. 60% 50% 40% 30% 20% 10% 0% 10% 20% 30% Figure 4: Price trends of non cereal food commodities YoY (Dec 15 Dec 16) Livestock and product prices Prices of livestock and products remained stable during the reporting period (Figure 5). Compared to June 2016, the prices Cooking Oil chicken Live Masoor Moong Mash Figure 5: Livestock products price trends (Dec 2015 Dec 2016) On a one year comparison with December 2015, the prices of wheat and wheat flour negligibly decreased by 0.6 percent and 0.9 percent, respectively. During the reporting period, the prices of rice Irri 6 and Basmati negligibly varied on a monthly basis. In December 2016, compared to June 2016, the price of Irri 6 and Basmati slightly increased by 4.7 percent and 2.9 percent, respectively. Beef & Mutton (PKR per kg) Beef With Bone, (AQ) Mutton, Average Quality MILK (PkR per Liter Milk, Fresh, Unboiled Economic Survey of Pakistan, Ministry of Finance, Government Pakistan Bureau of Statistics. of Pakistan. Issue 5 January 2017 Page 3 of 6

4 of mutton, milk, and beef negligibly increased by 3 percent, 1.4 percent, and 0.4 percent, respectively. On a one year comparison (December 2015), the prices of mutton, milk, and beef negligibly increased by 4.5 percent, 1.1 percent, and 1.7 percent, respectively. Fuel prices In light of declining fuel prices globally, a significant reduction in prices of petroleum products has been observed in Pakistan. However, this reduction was still less than the level of decrease in the global market. The retail prices of Super Petrol and High Speed Diesel (HSD) remained unchanged during July November 2016, with only a negligible increase in December On a six month comparison with June 2016, the prices of Super Petrol and HSD increased by 3 percent and 4 percent, respectively. Whereas, compared to a year ago (December 2015), a significant decrease by 16 percent for Super Petrol and 13 percent for HSD was recorded, as shown in Figure Figure 6: Petroleum prices (Dec 2015 Dec 2016) Petrol Terms of trade (ToT) 15 The ToT is measured as the quantity of wheat flour that can be purchased with one day s income of an unskilled wage laborer 16. Figure 7 shows that the ToT remained stable during the reporting period. In December 2016, it was recorded at 14.2 kg. Compared to June 2016, the ToT decreased by 2.8 percent, mainly due to increased wheat flour price despite a slight increase in the daily wages recorded at the same time. Compared to a year ago (December 2015), the ToT in December 2016 improved by 3.6 percent mainly due to decreased wheat flour price and increased daily labor wage. This modest improvement in purchasing capacity suggests only some improvement in household food security amongst the poorest households whose main income comes from daily wage labor. HSD Price of wheat flour (PKR/kg) Figure 7: Terms of Trade (Dec 2015 Dec 2016) TOT Wheat flour Price PKR Internally Displaced People (IDPs) and the returnee situation in Khyber Pakhtunkhwa and FATA Thanks to significant improvement in security and government s continued efforts, displaced families from various agencies of FATA have returned to their places of origin in Some 66,400 families returned during the reporting period, which brings the total of retuning families to 227,284 families during March 2015 December However, 76,507 families are still in displacement. The government has announced an extension to complete the return by December IDPs are mainly concentrated in KP, while fewer numbers are in other parts of the country, and another estimated 7,200 families who have taken refuge in Afghanistan. The multi sectoral household assessment of IDPs currently residing in KP and Returnees residing inside FATA, led by OCHA Pakistan in August 2016 reports very high food insecurity based on the Food Consumption Score among both the surveyed groups. Overall, 23 percent of IDP households fall in the poor consumption category, 56 percent are borderline and 21 percent are in acceptable consumption category. Whereas, for the returning households, these rates are 22 percent, 61 percent and 17 percent, respectively. The diet of the IDPs and returnees is not only quantitatively inadequate, but also qualitatively poor and heavily cereal based. Poor diet diversity is a serious problem across these groups. Most of the food consumed is made up of staples (wheat in particular). Overall, the proportion of all surveyed households with low dietary diversity accounts for 21 percent. Across the IDP and returnee households, poor food consumption and dietary diversity is significantly higher among households headed by a female, or by a person without any formal education. To cope with shocks, the majority of households mainly adopt short term reversible coping strategies. However, some emergency irreversible coping strategies are also used by one in TOT (kgs) 15 Terms of trade (ToT) is the ratio of the price of the primary income good relative to the price of the primary expenditure good, it simply measures the purchasing power of a particular livelihood group. 16 The income base for computation of ToT is the average wage rate of five main cities (Lahore, Multan, Karachi, Peshawar & Quetta) Issue 5 January 2017 Page 4 of 6

5 every ten households, which will negatively impacts their food security in the future. IPC Chronic Food Insecurity Classification The IPC chronic aims to provide information to decision makers to inform on medium and long term programmes and policies to address structural inefficiencies and poverty, strengthening livelihoods, and increasing resilience. The IPC Acute Analysis, generally conducted in areas which experienced hazard or shock, focuses on short term strategic objectives while the IPC Chronic Analysis focuses on the prevalence of long term persistent food insecurity. Following the scoping mission from IPC Global Support Unit (GSU) to Pakistan in April 2016 to assess the feasibility and planning of IPC chronic in Pakistan, in November, the IPC Chronic training on analysis was organized with the GSU support and involved various related partners from government, UN and NGOs. Lack of long term and/or up to date data on some of the outcome indicators was the major limitation faced in this analysis. Other challenges included the lack of district level and gender dis aggregated data, lack of harmonisation of indicators and definitions of various surveys such as Pakistan Demographic and Health Survey (DHS), Pakistan Social and Living Measurement Survey (PSLM), Household Integrated Economic Survey (HIES) and Multiple Indicator Cluster Survey (MICS). A draft report of the analysis was submitted to the GSU for review, and the final report is expected by the first quarter of Food Security and Nutrition Strategic Review A Food Security and Nutrition Strategic Review started in March 2016 and continued during July December This strategic review is an independent, analytical and consultative exercise that identifies key challenges faced by Pakistan in achieving food security and improved nutrition, and provides prioritized areas for action for all humanitarian and development partners. The exercise is led by the Government of Pakistan. The first round of provincial consultations were completed in all provinces and regions, and a national consultation was organized in November The draft Report (Aid Memoire) was also reviewed. The second round of provincial consultations will take place in the first quarter of 2017, followed by a national launch of the report, tentatively scheduled in late March Disaster Monitoring Even though no major disaster was reported during the second half of 2016, some localized disasters occurred in parts of the country. The Khyber Pakhtunkhwa (KP) province experienced unprecedented floods in Ursun Chitral. In July 2016, cloud and glacial lake outburst occurred along with torrential rains, thus hitting parts of KP, including the south west area of Chitral district. Ursun Valley, a remote area of Chitral, was badly hit by flash floods. At least 29 people died and 4 were injured. In addition, 20 houses were fully damaged and 35 partially damaged. The flash floods washed away a mosque and several houses in the Darosh Valley of Chitral. Since the Chitral district had also been affected earlier by the monsoon floods, households vulnerability had already been increased and their resilience to subsequent shocks had been weakened. The situation should be closely monitored during the coming lean season for early warning and timely response planning if required. On July 2016, heavy rains affected several parts of the country and caused floods, especially in the northern and northeastern provinces. Local media reported more than 22 people dead, 60 people injured, and several houses damaged in Punjab and Khyber Pakhtunkhwa provinces. In the Tharparkar district and surrounding areas of the Sindh Province, a third consecutive year of cereal production shortfalls due to drought, coupled with losses of small animals, has aggravated food insecurity and reportedly attributed to increased malnutrition. During the 2016 monsoon season, the rainfall amounts had shown a mixed pattern over the country with heavy seasonal rainfall over the upper central Punjab & KPK area, but largely deficient over Balochistan & Sindh. Coastal areas of Balochistan and western parts of Sindh received very little or no rainfall in the whole season. The Potohar plateau in the northeast, i.e. Islamabad and its surrounding areas such as Rawat, Gujar Khan, Taxila, Attock and Rawalpindi, that solely rely on rain fed agriculture are mostly affected by slow crop growth due to unusually high temperature and dry spells during the peak wheat sowing months of October and November. In these areas, even if rains do come in January and February, it is perceived that the wheat output would be less than 50 per cent of normal, because the grain heads will be underdeveloped. Weather Outlook 17 Neutral ENSO and IOD conditions are prevailing in the Pacific and Indian Oceans, respectively. Global climatic conditions and output of different forecasting models suggest the following: Two to three weather systems are likely to pass across the upper parts of Pakistan resulting in near normal rain and snowfall in January Fog with variable intensity is likely to prevail in Punjab, Sindh and plain areas of KP during January. 17 The outlook is based on recent data by Pakistan Meteorological Department which is updated monthly. Issue 5 January 2017 Page 5 of 6

6 Situation will improve as normal rainfall and slightly above normal snowfall is expected during the month of February. Map 1: Accumulated Rainfall Food security outlook Given the performance of agriculture subsectors and the fact that negative agriculture growth is mainly driven by reduced cotton production, it can safely be anticipated that food supply is not going to be a critical issue in the country this year. Overall, the food availability situation is stable in the country owing to sufficient production of the main staple crops wheat and rice. Pakistan s ending stocks for 2016 are recorded at 3.75 million MT, with a negative growth rate of 1.96 percent compared to previous year. Despite a negative growth rate of wheat ending stocks, the future outlook appears relatively promising as early projections for Pakistan point to a larger production in During , the performance of the agriculture sector as a whole, however, remained dismal as it witnessed a negative growth of 0.19 percent, against a 2.53 percent growth during Secondly, the Terms of Trade in December 2016 slightly improved by 3.6 percent, compared to December 2015 due to decreased wheat flour price and an increased daily labour wage. However, this modest improvement in purchasing capacity suggests only some improvement in household food security amongst the poorest households whose main income comes from daily wage labour. Though the supply of food may not become critical, important factors affecting food security remain, including poverty, low education levels, extreme environmental conditions, and natural and man made disasters. Together, these factors deplete the affordability of households and limit their access to adequate nutritious food. Pre crisis Market Analysis (PCMA) in Drought & Flood Affected Districts of Sindh Province The PCMA is a modified version of Emergency Market Mapping Analysis (EMMA) designed for both slow onset disasters (like drought) and rapid onset disasters (like floods, earth quake, and typhoon) employed during pre crisis situations. The information generated by the PCMA assists in planning market based emergency responses. The PCMA was conducted in three districts of Sindh in December 2016, including Tharparkar and Umerkot affected by drought (during ) and Jamshoro (affected by floods in 2010, flash flood in 2011 and long dry spell from ). Two critical commodities, Wheat Flour on which the poor and very poor are usually dependent on market purchase, and Goat which is a single most important asset for the poor in Sindh, were selected and analyzed upon extensive consultations at the national and provincial levels with relevant stakeholders. Supplementary analysis of the fodder and water markets was also suggested. The preliminary findings revealed that acquiring wheat flour and keeping goats during normal and emergency periods is very different and challenging. The reports suggest several response options for drought and flood affected communities as well as market based responses in case of any future emergency. For the wheat flour market, the recommended response options include: the distribution of wheat where local milling is possible, or wheat flour due to limited physical and economic access especially during floods; unconditional cash based transfer; support to the government and the private sector to improve storage, and the provision of wheat seed and fertilizers to poor and very poor households. Regarding the goat market, the suggested response options include a livestock medication and vaccination program especially for goats, provision of fodder to poor and very poor households keeping goats, cash based transfer for goat owners, destocking, purchase of livestock from vulnerable households, and training on livestock management. For further information and feedback, please contact the Vulnerability Analysis and Mapping Unit, UN World Food Programme, Islamabad, Pakistan at Islamabad.vam@wfp.org 18 World Food Situation: FAO Cereal Supply and Demand Brief, 2017, FAO. 19 Economic Survey of Pakistan, Ministry of Finance, Government of Pakistan. Issue 5 January 2017 Page 6 of 6