Businessmen involved in the agricultural sector managed to boost vegetable exports by 11.5 per cent in the first quarter of the fiscal year.
This comes at a time when seasonal rains have left vegetable fields devastated nationwide – especially in Sindh.
The consequence of mass exports and heavy rainfalls has caused major shortages in the local economy. As a result, retail stores and street vendors have resorted to relying on Iranian and Afghani vegetables to keep customers from returning empty-handed.
With the decrease in vegetable supply, the prices have risen, which is not just true for the local economy but also for international markets where a 26 per cent rise in price has been recorded. The result of this inflation, while beneficial to farmers, is likely to negatively impact retailers.
The increase in prices will put retailers in a dilemma regarding their profit margins. They must either absorb these higher prices while decreasing their profit margins or protect them by increasing prices.
Either way, retailers are expected to suffer.
However, farmers will probably not be celebrating the extra exports worth $71 million for long. This is because Pakistani exporters have been exporting produce imported from across the border. The result could be loss in sales as international buyers purchase vegetables from Pakistan for their incredible taste.
The same taste can’t be found in imported vegetables. Which might leave international buyers disappointed with the drop in quality. Moreover, it does not make sense for international buyers to purchase the same goods for a marked up price when they can get the same product directly from the source.
Farmers are also growing worried over a potential loss in sales of their products in local markets. This is largely true because if prices of local produce continue to skyrocket, consumers may incline towards purchasing Iranian onions that come with attractive price tags. And with agricultural yields expected to take months to recover, farmers are losing our valuable market share to imported products.
What’s most concerning for farmers is the influx of Afghani produce. This is largely because Afghanistan is facing numerous sanctions, and farmers there are willing to sell their produce at figuratively “dirt cheap” prices. If local markets get flooded by these products, Pakistani farmers may lose out.
Farmers, especially those growing onions and tomatoes, will hope for an improvement in their yield levels. This will allow them to capitalize on the higher international and domestic prices.
Will Pakistan farmers be able to achieve this feat? Only time can tell.
