Silicon Valley private equity investor Tim Draper, a well-known international venture capitalist, is quietly investing in Pakistan's agribusiness, the largest provider of food commodities in the Middle East, according to San Francisco Examiner.
The share of livestock in Pakistan's agriculture output nearly doubled from 25.3 percent in 1996 to 49.6 percent in 2006, according to FAO. As part of the continuing livestock revolution, Nestle is investing $334 million to double its dairy output in Pakistan, according to Businessweek. Reuters is reporting that the company has already installed 3,200 industrial-size milk refrigerators at collection points across the country to start the kind of cold storage chain essential for a modern dairy industry, and give farmers a steady market for their milk. In another development on the infrastructure front, Express Tribune has reported that Pakistan Horti Fresh Processing (Pvt) Limited has invested in the world's largest hot treatment plant to process 15 tons of mangoes per hour for exports. Hot water treatment will also help reduce waste of fruits and vegetables by increasing shelf-life for domestic consumption.
In addition to foreign investors, big name Pakistani companies like Dawood Group's Engro, billionaire industrialist Mian Mansha's Nishat Group and former minister Jahangir Khan Tareen's JK Dairies are placing big bets on food and beverage market in the country. Annual milk consumption in Pakistan reached 230 kg per capita in 2005, more than twice India's per capita consumption, according to FAO.
Business Monitor International expects "Pakistani agriculture sector to reap record harvests for key crops such as rice, sugar and cotton owing to favorable weather in 2011 and the year-on-year increase in crop area following floods in 2010". "We expect the dairy, poultry and wheat industries to be the biggest beneficiaries of increased investment in the agriculture sector", adds BMI's report.
Pakistan is world’s eighth largest consumer of food and food is the second biggest industry in the country, providing 16 per cent employment in production, according to report published in Express Tribune. In addition to rising domestic demand, growth in agribusiness is supplemented by increased exports as Pakistan expands trade with new partners. BMI expects basmati rice to take up a greater share of the trade as production increases. Cotton production to 2015/16: 45.5% to 12.8 million bales. Increased demand from Europe and emerging markets will drive output. BMI also expect an increase in domestic farmers switching from rice and sugar to cotton cultivation. Sugar production to 2015/16: 22.1% to 4.8 million tons. Large-scale consumers such as confectioners, candy makers and soft drink manufacturers account for about 60% of the total sugar demand and will be the main drivers of growth.
Pakistan witnessed a livestock revolution follow Green Revolution. Here's how International Livestock Research Institute puts the dramatic changes in Pakistan's agriculture sector since the mid 1960s:
Since the mid 1960s, investment in Green Revolution technologies – high-yielding varieties of cereals, chemical fertilizers, pesticides, irrigation and mechanization of farm operations – significantly increased cereal crop productivity and output. Success in the crop sector created a platform for diversification of farm and non-farm activities in the rural areas including the livestock sector, especially the dairy sector. Some of the Green Revolution technologies had a direct impact on the dairy sector while others had an indirect impact. Increased cereal productivity and output helped to reduce prices of cereals relative to other commodities in both rural and urban areas. This, along with increased income from high crop-sector growth, created demand for better-quality foods including livestock products. This created market opportunities and incentives for crop producers to diversify into higher-value products, such as milk, meat, vegetables and fruits.
Pakistan has made significant progress in agriculture and livestock sectors showing that it has the potential to feed its people well and produce huge surpluses to fuel exports boom. The continuation of this progress will depend largely on success in making needed public and private investments in energy and water infrastructure and education and health care.
Related Links:
Haq's Musings
FMCG Consumption Boom in Pakistan
Music Drives Coke Sales in Pakistan
World Bank Report on Pakistan Agribusiness
Pakistan's Sugar Crisis
FAO Livestock Sector Brief 2002
Recurring Floods and Droughts
Poll Finds Pakistanis Happier Than Neighbors
Pakistan's Rural Economy Booming
Pakistan Car Sales Up 61%
Resilient Pakistan Defies Doomsayers
Land For Landless Women in Pakistan
Growing Water Scarcity in Pakistan
Political Patronage in Pakistan
Corrupt and Incompetent Politicians
Pakistan's Energy Crisis
Culture of Tax Evasion and Aid Dependence
Climate Change in South Asia
US Senate Report on Avoiding Water Wars in Central and South Asia
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Here's a Devex report on US support for agribusiness development in Pakistan:
A new project by the United States Agency for International Developmentand the Agribusiness Support Fund — a locally registered development organization in Pakistan — aims to boost the country’s agricultural sector.
The Agribusiness Project worth $90 million is expected to increase the competitiveness and productivity of the country’s horticulture and livestock subsectors, which generate the largest share of revenues worldwide.
The project, which will span five years, will help improve productivity and product quality through technical assistance programs meant for 62,500 farmers and 2,500 agribusiness stakeholders, and create 1.3 million jobs. It will also leverage $320 million by the private sector through cost-sharing support to 45,000 Farmer Enterprise Group members, 100 associations and cooperatives, 250 individual and corporate farmers, 40 extension providers, 140 small and medium enterprises, and eight companies.
http://www.devex.com/en/news/blogs/90m-usaid-agribusiness-project-in-pakistan-under-way-2
Here's an ET report on Russian interest in building Diamer Bhasha dam:
Russia is seeking direct award of a construction contract for the $13 billion Diamer Bhasha Dam in a government-to-government deal without resorting to international competitive bidding, sources say.
Faced with water and power shortages, Pakistan is looking for funds from China and Russia, who in turn want a government-to-government deal without international bidding.
The government’s search for funds came after multilateral donors asked Pakistan to get a no-objection certificate from India for the dam’s construction.
China and Russia want a similar arrangement for undertaking the Iran-Pakistan gas pipeline project, which has faced fierce opposition from the United States.
According to sources, Pakistan and Russia are likely to strike a final deal on the dam during visit of Russian President Vladimir Putin to Islamabad next month.
“A meeting of Pak-Russia inter-ministerial commission will be held before the visit of Russian president, which will work out a mechanism for financing mega projects,” a government official said.
In a meeting of the Inter-governmental Commission (IGC) held here on Monday, government officials gave a detailed briefing to the Russian team on planned energy projects. However, sources said, Russia made no firm commitment to the dam.
According to the official, it was just a preparatory meeting to discuss different projects, which could be tabled during deliberations with the Russian president.
In the IGC meeting, the Russian side was told that Bhasha Dam was a strategic project with power generation capacity of 4,500 megawatts to overcome the energy crisis. It will have water storage capacity of 8.5 million acre feet to feed the agricultural sector.
Chinese offer
The Chinese government has already offered Pakistan skilled labour for the construction of Bhasha Dam. China has 17,000 skilled workers, who have worked on the giant Three Gorges Dam, which is producing 30,000 megawatts of electricity.
On the other hand, multilateral donors have asked Pakistan to seek a no-objection certificate from India to pave the way for financing the dam, which they say is situated in a disputed territory. Instead, they have offered to finance another project – Dasu hydropower, but the government has rejected the plan and wants to complete Bhasha Dam first.
On Monday, a delegation of the World Bank, headed by Country Director Rachid Benmessaud, called on Federal Water and Power Minister Ahmed Mukhtar and once again offered to finance phase-I of the Dasu project.
Dasu hydropower project is situated 7 km upstream of Dasu village on Indus River and 350 km from Islamabad. The project is located in Kohistan district of Khyber-Pakhtunkhwa.
http://tribune.com.pk/story/435035/diamer-bhasha-dam-russia-wants-to-take-up-project-without-bidding/
Here's an ET story on US fund to support private investing in Pakistan:
The United States on Friday announced a multi-year Pakistan Private Investment Initiative worth $80 million in financial support to promote economic activities in the country.
Drawing on public-private partnerships, this initiative will spur job growth and economic development by expanding access to capital for Pakistan’s small to medium sized companies, according to a statement by the US embassy.
“Pakistan has a wealth of talented entrepreneurs that desperately needs capital to fully realise their potential,” said US Charge d’affaires in Pakistan, Richard E Hoagland.
He said that through this initiative, the United Stated can move beyond the traditional foreign assistance by playing a constructive role to help entrepreneurs expand their businesses, provide new jobs to Pakistan’s fast-growing population, and by improving lives in the country.
He said that market-oriented, commercial solutions which support Pakistan’s economic development have been a priority for the United States.
The US Charge d’affaires said that the “Pakistan Private Investment Initiative” will generate investment funds catalysed by US assistance.
The initiative seeks private or other qualified sources of capital for matching investments and funding management services. The investment funds will make equity investments in promising Pakistani companies, under-served by existing sources of capital.
The Pakistan Private Partnership Initiative welcomes proposals from qualified Pakistani, regional, and international fund managers keen on investments in Pakistan by October 12, 2012, said a statement of from the United States embassy.
http://tribune.com.pk/story/436968/us-announces-80-million-for-pakistan-private-investment-initiative/
Here's an ET report on Pakistani PM's "valuing US as a major development partner":
Prime Minister Raja Pervaiz Ashraf on Saturday said that Pakistan regarded its relations with the United States as “very important” and that Pakistan valued it as a major development partner.
Ashraf’s remarks came after he held talks with US special envoy to Afghanistan and Pakistan Marc Grossman, who arrived in the Pakistani capital on Friday for talks with top officials.
“The prime minister said that relations between Pakistan and the United States are very important and we value the United States as a major development partner,” a statement issued by Ashraf’s office said.
“We have a shared objective in fighting terrorism and need to cooperate more to get rid of this menace,” the statement said.
Ambassador Grossman said that future relations between Pakistan and the United States should be based on market access and trade.
The US government was working on a bilateral investment treaty to “facilitate” US investment in Pakistan and improve market access, according to the Pakistani statement.
It said that the United States has promised $200 million for the construction of Diamer-Basha dam in northern Pakistan.
Ties between Islamabad and Washington have been rocky for years, and have only just resumed after nosediving following the secret raid that killed Osama bin Laden and an air raid that accidentally killed 24 Pakistani troops.
Washington considers Pakistan’s semi-autonomous northwestern tribal belt as the main hub of Taliban and al Qaeda militants plotting attacks on the West and in Afghanistan.
http://tribune.com.pk/story/437202/pakistan-sees-us-as-major-development-partner-pm-ashraf/
Here's an excerpt of a Nation report on Pakistan's wheat harvest:
In 2011-12 Pakistan farms produced 23.3m tons of wheat. The total value of that harvest is over Rs611 billion or $6.4 billion; and 20pc of our national agricultural GDP is from wheat. Combining these figures illustrate the vital importance of wheat farming to the food security, income, and economic growth of Pakistan. He said that our future food security and economic growth depend on more science and more innovation coordination nationally and internationally. He said that the rust diseases of wheat are of special concern to this community and we are aware of the threat of wheat rusts, including stem rust Ug99, to the productivity of wheat in Pakistan. Wheat Productivity Enhancement Programme (WPEP), is supporting this meeting and our national efforts to protect and enhance the productivity of wheat through the application of science to ensure wheat rusts do not hurt our wheat and that our farm productivity increases. Wheat is the leading crop of the country occupying the largest area (8.7million hectares) under any single crop. Annual wheat planning meeting has been a regular feature and always helpful in discussing research findings and formulation future strategies for enhanced wheat production. The coordination mechanism like the annual wheat meetings has been a regular activity for a long time and with the launching of the WPEP (Wheat Productivity Enhancement Programme) of Pakistan. It will further enhance and strengthen the already existing linkages between the stake holders. WPEP and USDA funded project aims to enhance and protect the productivity of wheat in Pakistan.
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/13-Sep-2012/wheat-worth-rs-611-billion-harvested-in-2011-12
Here's an interesting Washington Post story on pink salt spa in Pakistan:
ISLAMABAD — You are going to have to take Pakistan’s newest health fad with a grain of salt. Actually, several tons of it.
A newly opened spa in the capital touts amazing curative powers for a mineral better known as a table seasoning. In fact, the spa’s chief executive, Sabkahat Qadeer Butt, is so convinced of its medicinal magic that he’s created the entire facility from salt.
And not just any salt, but pink salt mined from the foothills of the Himalayas.
Nearly everything in the cave-like space is carved from the rose-hued crystal -- from the bricks in the walls to the tiles of the steam bath, it is all hewn from slabs of salt. Patrons leave their shoes at the door. Even the pink pebbles of the floor are all rock salt, which is absorbed through the skin.
Pakistan is the number one producer of pink rock salt in the world, according to the government’s Ministry of Petroleum and Natural Resources. Butt, the Pakistani businessman who is CEO of the Khaas Health Care and Cure Club in Islamabad, says he used 1,400 tons of the substance to create the spa in the city’s Diplomatic Enclave.
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Butt, 48, said salt baths originated as an old Greek method of treatment. Alexander the Great took loads of the stuff back home after conquering parts of modern-day Pakistan, he said. Salt became known as white gold and was even used as currency: “The Greeks would pay their armies in salt. It was the major component of the barter system.”
Some of the historical uses of salt are widely known. It is a natural antiseptic, proponents say, and a natural preservative. Salt has been used to preserve everything from meat and fish to sensitive documents.
But new-age spas like the one in Islamabad tout salt therapy as a veritable cure-all. Pink rock salt contains 84 minerals and can help skin ailments, upper and lower respiratory functions and, when combined with heat, can be used for pain management, Butt said.
In Hollywood, salt wraps and baths are used for quick weight loss when stars need to slim down for roles or to walk the red carpet. “It is also good for high blood pressure,” Butt claimed.
And low blood pressure? Yes, that too. In fact, Butt declared, salt can treat 125 disorders and diseases.
Qutbuddin Kakar, an Islamabad-based doctor who specializes in tropical diseases and is associated with the World Health Organization, said he has heard of people taking salt baths as a cure for skin maladies. But otherwise, he said, “There has been no scientific evidence which shows or proves that pink salt is a cure for so many or all diseases.”
While blanket curative claims are dubious, that hasn’t kept some fad followers from developing an appetite for the blush-tinted condiment. Ordinary table salt costs about 3 cents an ounce in U.S. grocery stores, whereas the pink stuff can fetch $1 an ounce.
There is one catch: Salt disintegrates when exposed to water and steam. So what happens when the spa melts? Not a problem, said Butt. He also owns a salt mine. “If the walls dissolve, I can replace them.”
http://www.washingtonpost.com/world/asia_pacific/in-pakistan-a-pink-salt-spa/2012/09/18/75ea6d0c-ff7a-11e1-b153-218509a954e1_story.html
Here's a PakTribune story on buffalo semen production in Pakistan:
Vice-Chancellor, University of Veterinary and Animal Sciences (UVAS) Prof Dr Talat Naseer Pasha said that despite lack of a proper mechanism of semen prodcution in the country and around 3.5 million poor semen doses, Pakistan has the best buffalo breed producing 67 percent milk from them.
Talking to APP on Sunday, he said the private sector was producing 3.5 million semen doses against the government's 2.5 million doses. He deplored that it was very alarming that the quality of bulls being used for semen collection was inferior as the private sector was just doing business without covering the aspect of animal genetics.
Whereas the public sector dose after a sample check of around 5,000 doses in the quality lab, it is commercialised. If we provide quality semen to small farmers on their doorsteps it will bring a revolutionary change in the fast growing livestock sector, he added. He said Pakistan had the best buffalo breed in the world and 67 per cent milk was being produced from elite dairy animals. But, he said, there was lack of awareness about the selection of best bulls for breed improvement and absence of progeny testing which was causing low productivity of dairy animals. The VC also highligted major constraints in the livestock sector including lack of genetic improvement, poor nutrition, health constraints, unorganized marketing and lack of human resource at various levels.
Steps to overcome these constraints are vital to upgrade the livstock sector in the country, he added.
http://paktribune.com/business/news/Pakistan-has-best-buffalo-breed-in-world-10392.html
US AID promoting private equity investment in Pakistan's SME sector, reports Express Trib:
..$80 million, earmarked by the Obama administration under the Kerry-Lugar-Brahman Act for the Pakistan Private Investment Initiative
Crowding-out of the private sector from credit channels due to reckless government borrowing has provided a unique public relations opportunity to the US. The US has said it will offer loans ranging from $500,000 to $5 million to small and medium sized business in Pakistan, to help the latter expand and create jobs.
In total, $80 million, earmarked by the Obama administration under the Kerry-Lugar-Brahman Act for the Pakistan Private Investment Initiative, will go towards providing cheaper financing and equity to small and medium enterprises (SMEs) in Pakistan.
“The United States Agency for International Development (USAID) will provide up to $24 million for an equity fund, and fund managers will be required to match the requested funding to take the size of each equity fund to at least $45 million,” said Theodore Heisler, the project manager and senior economic growth advisor to USAID.
Heisler said that co-investment was essential in bringing the size of each fund to a level where it can cover operating expenses. The US intends to create at least three funds, but is, as yet, noncommittal to the total number. US authorities are on the lookout for good fund managers, and the availability of quality managers will determine the numbers of the funds, officials have said. During the last fiscal year, the federal government borrowed Rs1.77 trillion to finance the budget deficit. The State Bank of Pakistan has already warned that due to increasing government borrowing, there is little credit available for the private sector to grow.
“Having access to finances is a challenge for SMEs, as there is little equity and debt available for the sector,” said Heisler. “The longer term goal is to help expand the market for private equity investment and provide money that is not available through banks and other international lending agencies,” he added. He said the real job growth potential lies in the SME sector, as the corporate and public sectors cannot create unlimited jobs.
Heisler said each fund will have a 10-12 year lifespan. Individual investment sizes will range from $500,000 to $5 million, but could vary depending upon requirements. The initiative has been modelled on the Polish American Enterprise Fund, which was started with $140 million and has now grown to a multi-billion dollar fund.
Heisler said the US is looking to create a private equity industry in line with global standards, as there is hardly any private equity investment fund in Pakistan. He said the other purpose was fetching foreign investment through co-investment, as investment in Pakistan is dwindling.
The US is currently looking for fund managers who have a successful history, and Heisler said that both local and international fund managers have expressed interest in the project.
To a question whether Pakistani fund managers have expressed reluctance due to doubts over long-term commitment issues with the US, the US embassy replied “we believe there will be substantial interest from local, regional and international investors”.
It further said that “the US government designed the Pakistan Private Investment Initiative after a year of research and consultations with numerous stakeholders, including the Pakistani private sector and regulatory authorities.” It added that USAID will structure the funding to ensure that it is sustainable.
http://tribune.com.pk/story/442469/credit-crunch-as-banks-turn-their-backs-on-private-sector-us-steps-in/
Here's an excerpt of a piece from Venturebeat.com on venture capital in Pakistan:
Naseeb.com was definitely the example that led DFJ and EPlanet to back Rahman’s next venture, the Lahore-based online job portal, rozee.pk, in 2007. That was a time “when everything was turning upside down in Pakistan,” Rahman said. The constitution had been suspended, bomb blasts were a daily occurrence and Benazir Bhutto was assassinated. That did not scare the investors who Rahman had bombarded with data on the robustness of Pakistan’s market and the growth projections of his enterprise.
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Venture capital has always been anchored in taking a risk on an individual and an idea, where the probability for success, as Rahman noted, is “super, super low.” And risk is exactly what Pakistan needs to encourage in order to jumpstart investments and the flow of capital.
Capital in Pakistan is frozen in a different era. Banks balk at extending credit to innovative startups, even where contracts guarantee return.
That is what happened to Shakir Husain, CEO and founder of the technology outsourcer Creative Chaos, when he went in to request a $100,000 loan to expand his business
“Put together collateral for $100,000 and we’ll give you this loan,” he was told. When the entrepreneur replied that he had a $1 million contract from a client based in the United States, he was still refused. “Had I been a textile company where I could produce a letter from my client there would have been no problem. Being a software company, they didn’t know how to collateralize that risk.” He eventually self financed.
He also set out, much like Reid Hoffman, to ensure that other aspiring entrepreneurs have access to risk rather than roadblocks. He, along with Rahman and other established Pakistani entrepreneurs, has become an angel investor. This has resulted in some progress.
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The Acumen Fund, a U.S.-based non-profit which uses philanthropic dollars to make venture investments, is one resource for larger amounts of financing. Self-described as a “social venture fund” that promotes “patient capital,” Acumen has invested millions in several Pakistani “social” enterprises, which have proven to effectively serve the social needs of the poorest.
The Kashf Foundation, Pakistan’s second largest private microlender, is Acumen’s best example. Touching nearly 1 million Pakistani women, Kashf has dispensed $100 million in loans and has closed over $36 million in commercial deals with local and international banks.
Pakistan’s “non-social” entrepreneurs require similar and bold backing. They require it, not from the philanthropic or non-profit world, but the private sector. Capital markets cannot be built by anyone else. Nor can Pakistanis build them alone. This is where U.S. venture capitalists can help.
Certainly, firms on Sand Hill Road or Route 128 aren’t in a position to source deals for individual Pakistani entrepreneurs. The levels of financing, which would average around $200,000 to $400,000, would not be worth the exorbitant transaction costs. Pakistan’s weak legal system would require tough term sheets that would be a disadvantage to most Pakistani entrepreneurs. Conducting due diligence, the real value to entrepreneurs, would be a challenge.
What they can do is challenge Pakistani banks and investors to create a Pakistan venture fund that they would then match. There are already several investment firms in Pakistan, such as the Abraaj Capital Group-backed BMA Capital, that could administer the fund. Last year’s announcement by The Overseas Private Investment Corporation (OPIC), a U.S. government agency, approving $455 million in financing to support the establishment of five private equity funds to invest in Middle Eastern companies provides a precedent and model....
http://venturebeat.com/2010/11/16/pakistan-venture-capital/
Couple of stories from Daily Times:
1. Mobile Phones:
KARACHI: Pakistan is a land of opportunities and the credit for this goes to the huge youth population and the rich pool of talent available in the country. These sentiments were expressed by All India Management Association Senior Vice President and Nokia IMEA VP D Shiva Kumar during his recent visit to Pakistan. He was one of the key speakers from India at the two-day management conference between the two countries in Lahore.
http://www.dailytimes.com.pk/default.asp?page=2012\09\27\story_27-9-2012_pg10_5
2. Agri:
ISLAMABAD: Sixty-four specialists from the ministries of agriculture from Khyber Pukhtunkhwa, Gilgit Baltistan, Azad Jammu and Kashmir (AJK), Sindh, and Balochistan have completed a 10-day course on modern farm business and irrigation methods sponsored by the US. The participants will help farmers increase their profits by approaching farming as a business: farmers will be able to identify higher-value crops and access new markets and customers. The US Agency for International Development (USAID) organised this training session to help increase profits through better product quality and water management.
At the completion of the training course in Islamabad, USAID Country Director Jonathan Conly said, “By using modern techniques, Pakistani farmers can capture new customers and increase their profits. The United States is committed to helping Pakistan modernise its agriculture sector so that farmers can improve their livelihoods.” After the workshop, an agricultural specialist from AJK Amina Rafi added “Farming in mountain areas has always been a challenge. I am glad that this training has provided me with skills to help farmers in AJK improve their businesses.”
http://www.dailytimes.com.pk/default.asp?page=2012\09\27\story_27-9-2012_pg5_4
Here's a Businessweek story of Pakistan's rising rice exports:
Rice exports from Pakistan, the fourth-largest shipper, are set to rebound from November with the new harvest after a rally in domestic prices and cheaper supplies from India cut shipments, a traders’ group said.
Overseas sales may reach 4 million metric tons in the year that began on July 1 as increased supplies from the new crop cool local prices, said Safder Hussain Mehkri, vice chairman of the Rice Exporters Association of Pakistan. Exports slumped 46 percent to 238,659 tons in the July-August period, according to Pakistan Bureau of Statistics. Shipments were 3.7 million tons in 2011-2012, according to the association.
Rice, staple for half the world, is poised for a second monthly decline as Thailand and India, the world’s biggest exporters, accelerated sales. Futures are little changed this year, lagging behind corn, wheat and soybeans, as global rice harvests are set for a record.
“New harvest will bring down the prices which are way too high at the moment, making us less competitive in the global market,” Mehkri said by phone from Karachi. “Our rice is 10-15 percent costlier than India’s. Better domestic prices will improve our competitiveness against India.”
Non-basmati rice from Pakistan was sold at about $451 a ton free-on-board in July and August, while it was $385 a ton in India, according to data from the exporters’ associations in both the countries. Rough rice for November delivery was little changed at $14.90 per 100 pounds on the Chicago Board of Trade at 6:48 p.m. in Singapore yesterday. Futures have lost 2.5 percent this month.
Indian Exports
India will export 8 million tons in 2011-2012, making it the top shipper ahead of Vietnam and Thailand, the U.S. Department of Agriculture data show. In 2012-2013 India’s shipments would drop to 7 million tons, compared with Thailand’s 8 million tons and Vietnam’s 7 million tons, the USDA estimates. Pakistan’s exports in 2012-2013 will reach 4 million tons, according to the agency.
Shipments from Pakistan were also hurt by international trade sanctions on Iran, which made payments between traders in the two countries difficult, Mehkri said. The rice harvest this year may surpass the 6 million tons in 2011-2012, he said.
http://www.businessweek.com/news/2012-09-26/pakistan-s-rice-sales-seen-climbing-as-harvest-set-to-cut-prices
Here's a News excerpt on tractor sales in Pakistan:
Tractor sales increased immensely, by 190 percent YoY, to 2,855 units in comparison with the sale of 957 units in the same period last year. However, August 2012 sales (2,855 units) went slightly higher as compared to July 2012 sales (2,828 units). Al-Ghazi tractors registered a sales growth of 300 percent YoY but a sales decline of 28 percent MoM to 1,216 units. Millat tractors sales boosted by 151 percent YoY and 44 percent MoM to 1,639 units, the data said.
On cars:
Pakistan Automotive Manufacturers Association (PAMA) has recorded a decline of 30 percent year-on-year (YoY) in automobile manufacturing to 20,820 units in August 2012, according to the PAMA data released for the same month.
A month-on-month (MoM) analysis of the sector demonstrates a comparatively steady performance with the sector’s sales down by a modest 0.5 percent to 10,385 units. This can primarily be attributed to the low base effect of July 2012, owing to fiscal year-end phenomenon and implementation of taxes in the federal budget 2012-13.
Segment-wise breakup shows that car sales in August 2012 went down by 13 percent YoY to 8,467 units while the 1300cc and above segment shrunk by 17.6 percent YoY. Sales of light commercial vehicles (LCV) and 4x4 registered an 18.3 percent YoY declined in August 2012, mainly due to a decrease in sales volume of Bolan, Ravi and Hilux.
Pakistan Suzuki Motor Company Limited (PSMC) registered a sales decline of five percent YoY to 6,002 units but continued its performance as a market leader. However, in August 2012, its market share dropped by six percent YoY to 56 percent. The reason behind this decrease was the discontinuation of its brand Alto, which was PSMC’s leading brand in 1,000cc category.
A better picture can be seen on MoM basis as it shows a seven percent improvement in sales volume of the company, the PAMA data said. This was mainly accounted for the base effect of lower sales volume in July 2012.
PSMC has been successful in attracting its Alto customers towards Mehran, Cultus and Swift models, which registered YoY enormous sales growth of 40 percent, 21 percent, and 16 percent respectively in August 2012 while other models including Liana, Bolan and Ravi showed YoY decline of 26 percent, 10 percent and 34 percent respectively.
Indus Motor Company Limited (INDU) experienced sales contraction of 28 percent YoY during August 2012 to 3,092 units. During this period, sales went down by 30 percent YoY to 6,179 units. The main reason behind this was a 10-day production halt in July-August 2012 due to higher inventory and pre-buying of buyers and road side dealers in June 2012.
Corolla’s sales decreased by five percent YoY to 2,800 units in August 2012 while Hilux sales improved by three percent YoY to 282 units. MoM sales of the Corolla grew by 14 percent while sales of Hilux drastically decreased by 50 percent, the data said.
Imported Japanese second hand cars are becoming major competitor for INDU flagship brand Corolla as during FY12 about 55,000 units of used Japanese cars were imported in the country.
Hence, it has become a serious threat for INDU as all eyes will now be on the upcoming Auto Industrial Development Program (AIDP 2012-17), which will set the course for future direction for imported cars in the country.
Honda Atlas Cars Pakistan Limited (HCAR’s) experienced a sales drop of 14 percent YoY to 1,241 units in August 2012. The period under consideration portrays an improved picture as sales increases by 20 percent YoY.
http://www.thenews.com.pk/Todays-News-3-131559-PAMA-records-30pc-decline-in-automobile-manufacturing
Here's Express Tribune on growing food market in Pakistan:
Pakistan is a huge and growing market for food. In big cities like Karachi and Lahore, restaurants of all types and sizes are jam-packed during opening hours. Looking at the restaurant business, it appears that very little, including economic uncertainty, has adversely affected food consumption. The popular media has also picked up on this culinary zeitgeist and almost all the TV channels in the country have programmes on cooking and other aspects of food.
For some years a number of ‘food streets’ have sprouted up in different cities, most notably Karachi, Lahore and Islamabad. In terms of growth potential and expansion, Lahore offers exciting opportunities. The area that stands in the shadow of the historical Badshahi Mosque is a great example of regeneration that the government of Punjab successfully undertook. Such regeneration projects in different parts of the country are not only developing a culture of sophisticated culinary habits, but are also creating sustainable employment opportunities for many.
Other newly-established food streets and similar developments include Sea View restaurants and Port Grand Food Street.
Creating business opportunities around the consumption of food is arguably the foundation of a sustainable economy, especially in a country the size of Pakistan. There are numerous examples of successful global food businesses that have contributed immensely to the economies of their respective countries of origins. McDonald’s is perhaps the best example of such a success story, with gross revenues of over $34.17 billion (2012 figures). In terms of financials, McDonald’s is bigger than Latvia, as the latter’s GDP of $26.14 billion (2011 figures) was smaller than McDonald’s annual revenue for the same year ($27 billion). Although Subway is the largest restaurant chain in the world in terms of the number of restaurants (37,000 outlets), McDonald’s remains the largest in terms of total revenue.
http://tribune.com.pk/story/444750/culinary-zeitgeist-the-food-business-in-pakistan/
Here's Economic Times' report on Pakistan sugar exports:
NEW DELHI/MUMBAI: Pakistan has allowed the export of an extra 200,000 tonnes of sugar, on top of the 300,000 tonnes already allowed, as the government aims to trim surplus stocks and bolster local prices.
Higher stocks and expectations of robust output next year encouraged the Islamabad government to allow the export of the additional sugar, Ali Raza Bashir, spokesman for the Finance Ministry, said, though the permission was for less than had been sought.
"There was a request to allow (extra) exports of 400,000 tonnes but the cabinet gave its permission for 200,000," Shunaid Qureshi, chairman of the Pakistan Sugar Mills Association, said by telephone.
The move came as neighbour India sealed deals to import about 5,000 tonnes of white sugar, despite expectations of a domestic surplus, as some traders seek to capitalise on lower prices in Pakistan and higher prices in India.
In Pakistan, sugar output in the crop year starting Oct. 1 is likely to remain steady at last year's level of around 4.7 million tonnes, Qureshi said.
The country's sugar consumption is between 4 million tonnes and 4.2 million and it started the 2012/13 year with around 400,000 tonnes of stock, said a dealer in Karachi who declined to be named.
Most sugar so far has gone to Afghanistan, Saudi Arabia and east Africa.
"These countries will again show interest due to lower prices. Millers in Pakistan want cash to start the crushing season ... They can give discounts to world prices," the dealer said.
INDIA BUYS WHITES
A New Delhi-based trader, who did not wish to be named, said: "The (Indian) traders who have contracted imports from Pakistan perhaps found the FOB price of $545 per tonne attractive enough to buy.
"They stand to gain $15 to $20 a tonne after paying a duty of 10 percent," the trader added.
The sugar price in western India is around $680 per tonne, while in northern and eastern parts of the country it is as high as $720.
India, the world's top consumer and the biggest producer behind Brazil, has been an exporter for the past two years. Exports in the year to September 2012 totalled 3.3 million tonnes.
Traders in India, which levies a 10 percent tax on sugar imports, have booked whites from Pakistan for delivery at the eastern Haldia port, a second Indian trader said.
India is expected to have a small exportable surplus in 2012/13, though higher production costs could make it difficult to find buyers at prices acceptable to mills.
Last month, Indian mills signed deals to buy up to 450,000 tonnes of Brazilian raw sugar because of the attractive gap between domestic and overseas prices.
The strengthening Indian rupee and a wide gap between Indian and Pakistani prices made these deals attractive, said a Mumbai-based trader with a global trading firm.
India could buy more for delivery in October and November to meet higher festival demand, traders said.
http://economictimes.indiatimes.com/news/economy/foreign-trade/pakistan-allows-more-sugar-exports-india-to-import-5000-tonnes/articleshow/16673077.cms
Here are a couple of recent stories on Pak agribusiness:
1. Harvard Business School picks Pakistan's K&N for case study:
Karachi: World’s most prestigious business school in the United States of America, Harvard Business School (HBS) has selected a Pakistani company, K&N’s, as a case study.
HBS faculty members select companies from around the world for a written account of a company focusing on strategic business issues, of interest to a global audience, which are then used for classroom discussions. HBS case studies are world renowned, and not only used by HBS faculty, but also by majority of leading business schools and universities around the world for teaching.
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K&N’s is greatly honoured with this achievement, as for any company, becoming a HBS case study is a great honour. While felicitating K&N’s, Pakistan Poultry Association (PPA) said is proud to have its founding member featured as a HBS case study as it is the only company from Pakistan to have been chosen by HBS to write the case study and use it in its executive education programs. This is also a great achievement as a very positive image of Pakistan will be reflected through the K&N’s case study reading and discussions by thought-leaders and key decision makers from the global food and agribusiness industry, and university students alike, around the world.
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K&N’s integrated poultry operations include grand parent breeding, parent breeding, hatching, feed milling, broiler growing, poultry processing, and production of ready-to-cook & fully cooked chicken products. K&N’s Quality Assurance Lab monitors and regulates the integrated poultry operations to ensure K&N’s chicken products are wholesome, safe and healthy. K&N’s manages its own product distribution (including Pakistan’s most extensive cold-chain distribution system) and a chain of chicken stores for its range of chicken products.
http://www.thenewstribe.com/2012/10/02/harvard-business-school-selects-pakistani-company-kns-for-case-study/#.UIbRNdfCeSo
2. Japan's JICA helping build vapor heat treatment facility for mango exports to Japan:
Japan International Co-operation Agency (JICA) is likely to extend its help to Pakistan for setting up a vapor heat treatment (VHT) plant worth Rs 170 million in order to tap the higher end Japanese market. The offer was made by Yuji Aoki (Japanese Consultant, TDAP) while speaking at a meeting held at the Pakistan Horticulture Development and Export Company (PHDEC), says a spokesperson here on Monday.
The meeting was informed that PHDEC had already succeeded in sending mangoes to Japan on trial basis in its endeavours to tap higher-end Japanese market. Yuji Aoki speaking on this occasion said that the plant could be installed in Pakistan before the next mango season. He said mango was liked by Japanese people for its sweet taste but there is need to develop certain infrastructure facilities for standardisation at production, packaging and processing level to meet the SPS requirements of Japanese market.
Akram Khalid, Sr. G M Co-ordination, PHDEC chairing the meeting said that PHDEC will network with stakeholders to get their feedback and to assess the viability of this costly initiative. Nudrat H Khan Senior Manager (Marketing) PHDEC said that a comprehensive marketing campaign can be organised in Japan with the collaboration of commercial section of Pakistan Embassy in Japan.
Sarfraz H Iqbal Sr Manager apprised AOKI about the projects and services of PHDEC. It is important to note that in Japanese market mangoes are sold in pieces at a comparatively higher price which is approximately 4 times greater than the price Pakistani mangoes fetch in its traditional markets, concludes the PHDEC spokesperson.
http://www.brecorder.com/agriculture-a-allied/183/1250459/
Here's a poultrysite.com report on Pak poultry sector:
Vice Chancellor of the University of Veterinry and Animal Sciences (UVAS) Professor Dr Talat Naseer Pasha has said the poultry sector was most attractive for investment as it had become the second largest industry after textile in the country.
Dr Pasha said that livestock growth was not satisfactory a decade ago. When the university was established, the government as well as investors paid due attention with the association of university’s academia, reports the Nation.
It brought about a revolution in poultry and dairy sectors. Farmer also have to realize the importance of the livestock sector, he added.
Ten years ago the share of livestock in agriculture GDP was 39 per cent which has now risen to 55.1 per cent, according to Dr Pasha.
The vice chancellor said the private sector had also contributed a lot to the livestock sector and set up modern slaughter houses.
However, the vice chancellor called for setting up joint laboratories to ensure the quality of food and feed of livestock. He said the government should evolve a joint system to gauge the quality of food and feed as well as meat.
http://www.thepoultrysite.com/poultrynews/27241/pakistan-poultry-industry-attractive-for-investment
Here's an ET report on Coke investing to expand in Pakistan:
LAHORE:
It was an announcement made so quietly that it did not even make the headlines: having already invested $172 million in Pakistan this past year, The Coca Cola Company – one of the world’s largest beverage companies – is planning on investing another $248 million in the country over the next two years.
It may have something to do with the fact that Pakistanis are estimated to have spent approximately Rs110 billion ($1.3 billion) on carbonated beverages in 2011, according to an analysis by The Express Tribune based on figures compiled from industry sources. Coca Cola currently enjoys a 30% market share, second only to arch-rival PepsiCo.
“We see great potential in Pakistan’s future, which is why the company is investing significantly in upgrading infrastructure and adding value to allied industries,” said Rizwan Khan, general manager for The Coca Cola Company in Pakistan and Afghanistan.
The money will be spent on two new bottling plants, one each in Karachi and Multan, as well as investing in more coolers, which will be distributed amongst retailers to help with the company’s retail sales efforts. Company officials were quick to point out that the investment is not simply the recycling of profits and cash flows from existing operations in Pakistan, but green-field foreign direct investment that will flow into the country over the next two years.
The expansion plans come as rising demand makes it difficult for Coca Cola to keep pace with its existing production capacity in Karachi and Punjab. The new plants will follow the establishment of a Coca Cola facility, already completed in 2011, which manufactures Coke cans. Previously, Coca Cola used to import cans from its factories in other countries.
Coca Cola’s business model in Pakistan is somewhat unique. The global US-based parent owns a subsidiary called The Coca Cola Export Company, which has a Pakistan branch. That Pakistan branch conducts all marketing and brand building activities and manufactures the concentrate for the company’s signature beverages from a plant it owns and operates in Raiwind.
The concentrate is then sold to Coca Cola Beverages Pakistan, a joint venture between the US-based parent and Coca Cola Içiçek, a Turkey-based partner of the group. Coca Cola Beverages Pakistan operates six bottling factories in Pakistan, located in Karachi, Gujranwala, Multan, Lahore, Rahimyar Khan, and Faisalabad.
Coca Cola used to have eight franchisees for its bottling facilities in Pakistan, but in the mid-1980s the company felt that the business model was not working. It then spent the next decade buying out every single franchisee in Pakistan, consolidating them under one umbrella to form Coca Cola Beverages Pakistan. This entity was a wholly-owned subsidiary of the US-based parent until 2008, when Coca Cola Içiçek took a 49% share.
The company declined to provide a precise revenue figure or growth numbers, but said that it buys close to Rs13 billion in raw materials from its 300 local suppliers. According to Coca Cola Içiçek’s annual report, the company’s revenue growth rate in Pakistan is in the high teens. Coca Cola has over 4,000 employees in Pakistan, and employs another 6,000 indirectly. Company officials say that it paid Rs11 billion in taxes last year.
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“Our aim is to inspire economic activity, create employment and increase tax revenue for the government. However, it is the government’s responsibility to ensure that a productive investment and business operating environment is provided to local and international companies,” said Khan.
....
http://tribune.com.pk/story/463423/beverages-why-coca-cola-is-investing-another-248m-in-pakistan/
Here's a recent Seekingalpha piece on Pepsi growth in South Asia:
Pepsi depends heavily on emerging markets for growth. It experienced a growth of 14% in emerging markets for the quarter. Organic net revenue in Europe grew by 7%, and in Asia, Middle East and Africa it grew by 10%. The company has significant international exposure, which means that the company's top and bottom lines are affected by foreign currency movements. This is made evident by a 5% decrease in company revenues due to foreign currency movement in the recent third quarter.
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Asia, Middle East & Africa (AMEA) unit experienced strong growth for the quarter. Organic net revenue grew by 10%. Within this unit, snacks experienced double-digit volume growth rate. Beverages' volume experienced high single digit growth rate. India and Pakistan experienced snacks volume growth of 12% and 27%, respectively. Beverage volume for India and Pakistan was up 23% and 25%, respectively. Constant currency operating profit for the unit grew by 14%.
http://seekingalpha.com/article/935611-pepsico-or-coca-cola
International frozen yogurt franchises Tutti Frutti and Fruz are coming to Pakistan, according to news reports:
Business Recorder on Tutti Frutti:
Tutti Frutti is a specialty brand available in various world markets, including the USA, Canada, Brazil, Malaysia, Thailand, Hong Kong, China, France, Pakistan and the United Kingdom. Work is in progress to open up outlets in countries like India, Bangladesh, Russia, Romania, Spain and various Middle Eastern countries.
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17 outlets already opened in Pakistan. There are five outlets in Karachi, three each in Lahore and Islamabad, two in Rawalpindi, two at Bhera Motorway rest area and one each in Abbottabad and Faisalabad. Another 19 are under-construction in different cities. We are targeting about 100 branches by the end of the year 2013, reaching customers in nearly every city of Pakistan.
http://www.brecorder.com/brief-recordings/0/1257571/
The Nation on Yogen Fruz:
LAHORE (PR) – Yogen Fruz, the world’s leading frozen yogurt chain opened its first outlet in DHA amidst much fanfare on Sunday. The master franchise of the Canadian desserts chain has been acquired by MFK Foods in Pakistan, and the local business group is already working on a plan to open outlets and franchises all across Pakistan.“When we received a query for bringing Yogen Fruz to Pakistan, we all were very excited. Pakistan is a huge consumer market and if the conditions are right, this country can attract a lot of foreign investments. We all flew in from Canada to be a part of this launch”, said Carlos Campo who is the Director Operations for Yogen Fruz worldwide, and is in Pakistan with his team to assist in the launch of this giant food and desserts chain.“Frozen yogurt is freshly prepared, is rich in probiotics, and is available in endless flavours,” added Basir Syed, CEO MFK Foods and master franchisor for Yogen Fruz Pakistan. “Yogen Fruz is here, and soon it will be available in all parts of Pakistan. We have an aggressive business development plan and we have received numerous franchise requests and sold many as well. We will also be opening outlets in other parts of Lahore as well.”
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/12-Nov-2012/yogen-fruz-launched-in-pakistan
Here's PakObserver on Pakistan's rising food exports:
Thursday, November 29, 2012 - Islamabad—Fruit and vegetable export from the country during the first four months of current financial year recorded increase of 4.21 percent and 10.97 percent respectively.
During the period from July-October 2012 about 120,794 metric tons fresh fruits of different varieties worth US$ 81.48 million exported as compared to the 135,323 metric tons valuing US$ 78.18 million during the same period of last year.
According the data of Pakistan Bureau of Statistics (PBS), during first four months of current financial year about 65,113 metric tons vegetables costing US$ 31.75 billion exported which was up by 10.97 percent as compared to 106,752 metric tons of US$ 28.6 million during same period of last year.
The export of fruit and vegetables witnessed increase in their exports in dollars term, however, the export in quantity term witnessed reducing trend during last four months of current financial year, the data revealed. Meanwhile, the export of sugar during the period under review recorded 100 percent increase as about 126,819 metric tons of sugar worth US$ 70.29 million exported.
From the period from July-October 2012, the export of meat and meat preparations also increased by 30.64 percent as about 22,836 metric tons of meat and meat preparations valuing US$ 7.37 (73.7?) million exported as compared to 19,062 metric tons worth US$ 59.4 million exports of same period last year,, it added. The data revealed that during the first four months of current financial year the export of all other food items recorded 30.64 percent increase as against the last year’s export.
During the period from July-October country earned US$ 343.26 million by exporting different food commodities where as it was recorded at 328.15 million during same period last year.
http://pakobserver.net/detailnews.asp?id=184461
Here's PakistanToday on raising Pakistan's food exports to Malaysia:
Pakistan and Malaysia have decided to further enhance bilateral cooperation in the field of agriculture with Malaysia agreeing to import more livestock, fish, rice, beef, fruits and vegetables from Pakistan.
“We are already importing a considerable amount of rice, fruits and other food products from Pakistan and we want this cooperation to grow further in the coming months,” said Malaysia’s Agriculture and Agro-based Industry Minister Datuk Seri Noh Omar during a meeting with Pakistan’s Minister for National Food Security and Research Israrullah Zehri in Kuala Lumpur.
During the meeting, Malaysia’s Agriculture and Agro-based Industry Minister Datuk Seri Noh Omar recalled his visit to Pakistan in December 2009 and his meeting with the then Minister for Agriculture Nazar Mohammad Gondal. He also mentioned about 171 buffalos which were given to Malaysia by the Government of Punjab and called for relaxing the procedure for importing more animals from Pakistan as Malaysia was in need of many more.
He also appreciated the quality of Pakistani fruits specially mangoes and kinoos and hoped that the quantum of fruits being imported from Pakistan will increase with the passage of time.
Datuk Seri Noh Omar noted that following his visit to Pakistan, three separate Memorandum of Understandings (MoUs) had been signed between the two governments for exchange of scientific knowledge and technology cooperation as well as for the import and distribution of fruit juices, fruit-based consumer products and frozen beef from Pakistan to Malaysia. Similarly, a Letter of Intent had also been signed between the Government of Punjab and the Department of Veterinary Services Malaysia for expanding cooperation in the veterinary sector.
Datuk Seri Noh Omar said the Malaysian government had moved swiftly on implementing these MoUs and it had already granted license for export of Pakistani beef to Malaysia while a total of 171 animals, including Neeli Ravi buffaloes, had also been imported from Pakistan for developing “our buffalo industry and improving their gene pool”. He also referred to the growing import of Pakistani rice to Malaysia which imported 43,000 MT of Pakistani rice in 2009 but increased it to 123,000 MT in 2010 and to a sizeable 148,000 MT in 2011 respectively.
Federal Minister for National Food Security and Research Israrullah Zehri thanked his Malaysian counterpart for inviting him to attend the Malaysian Agriculture, Horticulture and Agro-tourism Show (MAHA) 2012 and urged the Malaysian government to consider increasing import of beef and mutton from Pakistan as quality of meat was very good and the slaughtering of animals was in accordance with Halal standards. He also invited his Malaysian counterpart to visit Pakistan in February 2012 to attend the livestock fair held in Sibi Balochistan.
Later, Israrullah Zehri visited various pavilions and stalls set up at MAHA 2012. He evinced keen interest in various products, food items and livestock put on display. Later, he also spoke to the local media and shared with them various proposals and measures currently being pursued by Pakistan and Malaysia to enhance mutual cooperation in a diverse range of fields, including import of agricultural machinery and equipment; techniques of horticulture fruit-growing and vegetable gardening; plant protection and fertilizers; livestock farming and breeding; Green House technology; feed and feedstuff production; veterinary medicine; fish farming; energy-saving technologies for agriculture; production of biomass fuel, biogas, biodiesel, renewable and alternative energies (Biofuel); and water management and forestry.
http://www.pakistantoday.com.pk/2012/11/30/news/profit/malaysia-eyes-pakistani-livestock-food-products/
Here's a Fresh Plaza report on Pakistan kinnow exports:
Exports of Pakistani mandarin may reach the figure of $100 million around in 2012-13. Exports will start from December 1st 2012 and continue till the end of March 2013.
According to Ahmad Jawad, CEO of Harvest Tradings, heavy rains should help increase Kinnow exports for the 2012-13 season compared to last year, despite the fact that this year production is less than last year in Kinnow the farms of Sargodha district, the biggest citrus producing hub.
"For this season, around 1.8 million tons of production are expected and there are prospects that country's exports would be good. A target of 0.2 million tonnes has been fixed this season for Kinnow export."
He explains that Kinnow export to Iran will not take place because of non availability of e-forms by banks.
Indonesia and India have been added as new markets for the coming season. The export of Kinnow from Pakistan to Indonesia is expected to reach 40,000 tonnes during the coming season. Pakistan and Indonesia have already signed a preferential trade agreement to enhance trade between the two countries this year.
Jawad expects a tough time from China on the Indonesian market in terms of price, but in taste he says, "our product is far better than the Chinese Mandarin. Similarly good volumes are expected to go to India as well in the light of Most Favored Nation Status (MFN) which is granted by the Government of Pakistan to increase trade activities on both sides."
Similarly Malaysia also a favorite market for Kinnow due to Free Trade Agreement signed between two countries.
He goes on to say that, "over a period of time, Russia and Ukraine have also emerged as leading importers of Pakistani Kinnow. Total exports to both countries may now contribute to almost half of Pakistan's total exports, provided we deliver required quality to the Russian authorities."
Mr Jawad urged the support of respective commercial counselors for better promotion and level playing field.
He also sees bright prospects for future of Kinnow exports, but says this is subject to proper dedication and more research as the Kinnow is the only fruit whose juice costs as little as a cup of tea.
http://www.freshplaza.com/news_detail.asp?id=103695
Here's a PakObserver report on German packaging form Multivac entering Pakistani market:
Sunday, December 02, 2012 - Karachi—The overall food and beverage trade in Pakistan has surged to $ 6 billion during 2011. Keeping in view the potential in the food sector of Pakistan a German company MULTIVAC has started operations in Pakistan.
The company moves the market with innovative packaging solutions, individual consultation and exceptional service. Said Amir Sotoudeh, MD MULTIVAC Middle East.
The company manufactures machines for the packaging of fresh or processed food, sterile goods and other medical products, today the company has a worldwide organization with more than 3,300 employees in 55 countries, he added.
We want to facilitate food sector of Pakistan with better packaging facilities in sectors especially ready-to-eat meal, fresh and frozen meat, seafood and bakery products, he further said.
http://pakobserver.net/detailnews.asp?id=185066
Here's BMI report on Pak agribusiness:
The 2012 monsoon season was relatively kind to Pakistan’s farmers, especially in comparison with the devastating floods of 2010. Although localised flooding caused severe destruction in parts of Sindh and Balochistan, the main breadbasket region of Punjab enjoyed late rains after a dry start to the season, improving the prospects of rice, corn and cotton in particular.
Key Forecasts:
- Corn production to 2016/17: up 30.0% to 5.6mn tonnes. Continually improving yields and high prices on world markets will support an impressive increase in corn production.
- Cotton consumption to 2016/17: up 23.2% to 12.5mn tonnes. Demand for cotton will surge in the early years of our forecast as the EU lifts tariffs for a year, before falling back to steady yearon-
year (y-o-y) growth.
- Rice production to 2016/17: up 16.5% to 7.3mn tonnes. Pakistan will retain its place among the world’s most important exporters of the commodity as its producers look to expand into new markets.
- 2013 real GDP growth: 4.0%. Up from 3.7% y-o-y in 2012.
- Consumer price inflation: 12.4% in 2013 (up from 11% y-o-y in 2012).
Industry Outlook:
The 2012 monsoon season was relatively kind to Pakistan’s farmers, especially relative to the devastating floods of 2010. Although localised flooding caused severe destruction in parts of Sindh and Balochistan,
the main breadbasket region of Punjab enjoyed late rains after a dry start to the season; this has improved the prospects of rice, corn and cotton in particular.
In a major boost to the cotton industry, the EU has finally enacted a long-discussed measure that will suspend import duties on a range of cotton products from Pakistan. The European Parliament finalised the move in September, although the regulation will only apply until the end of 2013, rather than the two-year period initially pushed for by the EU. According to the Pakistan Cotton Ginners Association, the EU is one of Pakistan’s largest trading partners, accounting for more than 30% of the country’s total exports. Of this, the 75 items allowed under the deal contribute about EUR921mn, or 30% of the country’s total exports into the EU. ...
http://www.researchandmarkets.com/research/bgtf4x/pakistan
Here's Daily Times on USAID effort to enhance rural productivity in Pakistan:
US assists rural Pakistan increase productivity
Staff Report
ISLAMABAD: United States Agency for International Development (USAID)’s Pakistan Strategy Support Programme (PSSP) launched a 2-day First Annual Conference entitled ‘Productivity, Growth and Poverty Reduction in Rural Pakistan’ on Thursday.
The aim of this conference is to review the first year’s results from PSSP activities. The International Food Policy Research Institute (IFPRI) implements the PSSP. This is a four-year USAID funded, multi-dimensional, multi-partner initiative under the Pakistan Planning Commission’s framework for economic growth.
USAID is proud to support the Planning Commission’s efforts to achieve high standards of excellence in policy formulation and research through capacity building of researchers and analysts in Pakistan, said USAID Deputy Director Rodger Garner at the inaugural session of the conference. These efforts will contribute to a stronger, brighter future for all Pakistan, he added.
A National Advisory Committee chaired by Dr Nadeem ul Haque Deputy Chairman of the Planning Commission of Pakistan with members including Abdul Wajid Rana, Principal Officer and Secretary of Finance government of Pakistan supervises PSSP.
USAID assistance will enable Pakistan to modernise its policy formulation by improving research based policy analysis. This will create a more favourable enabling environment for investments and enterprise growth, Dr Nadeem ul Haque said.
USAID’s other economic growth activities include creating over 200,000 acres of irrigated land by the end of 2013, as well as increasing the incomes of 250,000 farmers and female agricultural workers by increasing their production and connecting them with markets throughout the country to improve sales and ultimately expand their businesses.
http://www.dailytimes.com.pk/default.asp?page=2012\12\14\story_14-12-2012_pg5_14
Here's Daily Times on German Multivac launch in Pakistan:
MULTIVAC the world’s leader in packaging solution has started Pakistan operation. The overall food and beverage trade in Pakistan has surged to $6 billion during 2011. Keeping in view the great potential in the food sector of Pakistan, MULTIVAC moves the market with innovative packaging solutions, individual consultation and exceptional service. We call it better packaging, our customers call it ‘success’, Amir Sotoudeh MD MULTIVAC Middle East
said.
http://www.dailytimes.com.pk/default.asp?page=2012\12\29\story_29-12-2012_pg5_20
Here's a NY Times blog post on India's planned dams and India's lack of concern for environmental impact on India ad reduction of water for Pakistan and Bangladesh:
...India’s government was grappling with growing pressure to increase the dependability of its electricity service — for the growing numbers who have intermittent power and the 400 million who live without it.
As a solution, the government proposed constructing 292 dams throughout the Indian Himalayas — roughly a dam every 20 miles. If completed, the 7,000- to 11,000-megawatt dams would double the country’s hydropower capacity and meet about 6 percent of the national energy needs projected for 2030 (based upon 8 percent annual growth of the nation’s domestic product). The dams, the reasoning goes, would provide electricity to needy people as well as offset carbon dioxide emissions from coal-fired power plants.
Scientists and citizens alike are crying foul, however, pointing out that the dams will probably displace millions and wreck ecosystems throughout the Himalayas.
No binding provisions are in place to ensure that displaced people receive adequate compensation and help with resettlement — and most of the projects are proceeding without adequate environmental impact surveys.
“The key issue is that there’s no requirement in India’s law to do cumulative impact assessments,” said R. Edward Grumbine, a senior international scientist at the Chinese Academy of Science’s Kunming Institute of Botany. Dr. Grumbine and his colleague, Mahara Pandit at the University of Delhi, wrote one of the first scientific papers discussing the dams, recently published in Science.
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How these dams may affect communities and ecosystems in neighboring downstream countries like Bangladesh and Pakistan is little discussed.
Climate change offers a further strike against the projects. By 2050, scientists predict, the water supply from the Brahmaputra and Indus — two major rivers among the 28 that would receive dams — will decrease by about 20 percent and 8 percent, respectively. Those reductions would in turn cut the rivers’ capacity to produce electricity, undermining the dams’ purpose.
http://green.blogs.nytimes.com/2013/01/07/hobbled-on-energy-india-ponders-a-multitude-of-dams/
Here's an ET story on cutting out middlemen in Pak agriculture value chain:
KARACHI:
In the food business, there is one strategy that works better than most others: disintermediation, or in layman’s terms, cutting out the middleman.
That is exactly the strategy being pursued by one of the world’s largest privately-held food companies, which is in the process of entering into an agreement to buy its supply of rice directly from Pakistani corporatised farms, cutting out the dozens of layers of commodity traders in between, increasing profits for both the Pakistani farmer and the foreign retailer.
The food company, one of the most significant players in the North American and European markets, has decided that it will source up to 30% of its basmati rice requirements from Pakistan through a company called Rice Partners, a corporate farming outfit being financed by Indus Holdings, an Islamabad-based venture capital and private equity firm.
With all the brouhaha about companies and governments from richer countries coming into poorer nations and buying up agricultural land, the arrangement being pursued by Rice Partners is a decidedly interesting one: the company will not own the farms, but instead will have contracts with farmers for both quality and quantity of produce that it will buy.
Rice Partners has selected about 27 farmers small and medium sized farms that collectively spread over 2,500 acres in and around Muridke in Punjab, in collaboration with their foreign partner. (Rice Partners has asked The Express Tribune not to disclose the name of their partner, since it is not a publicly listed company.)
The company will provide equipment to the farmers, assist them in improving their growing techniques and improve their overall productivity. The rice grown will be expected to meet some of the most rigorous regulatory standards and its quality will be audited by URS Pakistan, a leading quality certification and assurance company.
As a result of the higher quality and strict audits, the farmers will be paid a premium over market rates.
The difference in farm-gate prices (what the farmer gets) and retail prices (what the end user pays), are some of the highest in rice, with the retail price often being four to five times higher than the farm-gate price. Since Rice Partners will be selling directly to a retail brand, instead of going through the 10 to 12 intermediaries, it can afford to pay a much higher price while still remaining competitive.
For its part, the foreign food giant gets an assurance of quality that reduces its rejection rates which, company executives say, can reach as high as 50% in India. Rice Partners will be placing radio-frequency identification (RFID) tags in every bag of rice produced, which will offer its foreign partner an unmatched level of traceability – the ability to know precisely where the rice was grown in case there is ever a problem.
The first shipments of rice under the project are expected to be dispatched in early 2012.
While Pakistan is only the 11th largest producer of rice, according to the United Nations Food and Agriculture Organisation, it is the world’s fourth largest exporter, since rice is not a staple part of the Pakistani diet. Yet most of the exports are commodity based, rather than value-added.
...
http://tribune.com.pk/story/281091/cutting-out-the-middleman-global-food-giant-to-buy-pakistani-rice-directly-from-the-paddy/
Here's a Nation newspaper report on PASSCO ending middle men in wheat procurement:
ISLAMABAD - The Pakistan Agriculture Storage and Supply Corporation (PASSCO) is working on a plan to end the role of middle-man to purchase wheat in bulk rather than bardana.According to sources the move will go a long way to help reduce the rising trend of corruption in wheat procurement process and will help to discourage the role of middle-man in wheat purchase operation. It has also plan to register farmers and issue PASSCO cards during wheat sale operation and under the proposed plan wheat can only be procured in bulk without bardana in order to curtail the role of middle-man.It proposed by PASSCO to minimize the subsidy burden on the government of Pakistan and also to minimize the carrying cost wheat procurement targets allocated to PASSCO should be need driven and wheat procurement target to be given keeping in view the average requirement of dependent provinces .Armed forces plus strategic and any unforeseen factors."A payment mechanism be developed wherein the cost of wheat dispatched to Gilgit-Baltistan and Government of Azad Jammu and Kashmir (AJK) are directly paid at source in advance to PASSCO by the Federal government which, will save the national exchequer heavy mark-up which keeps accumulating due to present payment mechanism," sources said."PASSCO requires minimum storage capacity of 1.5 million tons because its godowns has the capacity of only 0.431 million (28 per cent) tons and the remaining 72 per cent wheat stocks were stored in open under tarpaulins," official date reveals." the situation is precarious at 2.039 million tons wheat stocks are lying in the open in far-flung areas (as on 24.09.2012) which has more susceptible to climatic hazards and pest attack,".It said there was a dire need to create additional storage facilities for PASSC and in this regard proposal and offer of Islamic Development Bank for construction of silos with capacity of .65 million tons need to be persuade at war footing on government level.It is quite relevant to mention here that PASSCO has to pay Rs12 billion mark-up on Rs93.54 billion of loans taken from commercial banks in current financial year 2011-12 to run its operations whereas it has to recover Rs19.7 billion dues from regional and provincial governments and other organisations, including the Pakistan Army, on account of wheat supply. In addition to these, PASSCO was to receive Rs3.8 billion on account of mark-up and financial charges from different agencies.
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/27-Oct-2012/passco-for-ending-middle-man-role-in-wheat-sale-operation
Here's a Nation report on Nestle training Pak dairy farmers:
LAHORE – The Nestlé Pakistan has planned to train 30,000 dairy farmers in next five years through its training centers established at Nestle Farmhouses with a view to improve milk quality as well as production.
This was observed by Nestle Pakistan Manager Corporate Media Relations & Policy Networking Saira Iftikhar, Regional Milk Collection Manager Syed Naveedul Hassan and Assistant Training Manager Salman Umer while briefing The Nation during a visit to Okara Nestle Farmhouse.
“The farmhouse training centers, including training centre of district Okara, are imparting training to around 2,000 dairy farmers annually, besides educating around 4,500 lady dairy farmers so far,” they observed.
Saira observed that Okara training project, started in July 2007, is providing technical assistance and advice about animal health, breeding and fodder production to female dairy farmers also in Punjab as well as half of Sindh to raise the quality and value of the milk they supply, which in turn boosts the local economy.
She maintained that Nestlé Pakistan has taken a key role in the country’s dairy development and is keen to bring new knowledge into the sector, both to build a better future for farmers and to improve the rural economy.
Regional Milk Collection Manager Syed Naveedul Hassan informed that the training is aimed at helping both small scale producers and large commercial farms to improve milk quality and increase milk production in a country which is seeing a growing demand for milk products.
Naveed explained: “We believe that Pakistan will grow very fast as a milk supplier and it has great potential for development into a leading milk exporter.”
“We hope that, through training, we can help our farmers to turn their herds into profit making ventures by improving farm management, efficiency and dairy animal welfare.
“As well as bringing in a valuable source of income, an increase in quality milk production will also provide a source of employment within communities and a significant boost to the economy, he elaborated. He added that it will also help to uplift the socio economic status of the rural workforce.
Assistant Training Manager of Milk Collection & Dairy Development Salman Umer expressed that the course was designed specifically to cover farm management, milk production, cattle health, nutrition and breeding.
The training is providing an excellent opportunity for farmers to learn from the mature international dairy sector, he said and added that Pakistan has the potential to double its milk production if just a few international good practices can be adopted into local conditions.
“Although the vast majority of our farms are small enterprises, the overall volume of milk produced makes Pakistan the fourth largest producer in the world. Just a 10 per cent rise in yield would make a significant difference, he added.” The participants of training said: “The training offered through Nestle Sarsabz Farm has been very effective in helping us towards this goal. The training programme has been making a strong impact on milk production.”
“This has been a very good experience which has exceeded expectations, stated farmers who were getting training. They added that there is a very keen and supportive culture at Nestle Training Centre which allows us to share experience and knowledge.
“We have seen many things which we can use as a benchmark to help us make improvements in our dairy farm. We have been delighted at the success of this very exciting and worthwhile programme with Nestlé Pakistan.
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/13-Jan-2013/nestl-to-train-30-000-farmers-to-improve-milk-quality-production
Here's an ET blog post taking media to task:
A recent article in Wired, Danger Room highlighted the resurgence of the US drone campaign in Pakistan. While it focuses on the war, a lot was left untold about the nation’s story that is as heartening as it is heartrending, and as inspiring as it is seemingly dismaying.
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The story of four of these start-ups, that launched in 2012 speak volumes about the resilience, commitment and resourcefulness of its founders.
The first is Vital Agri Nutrients, a young, agricultural Research and Development focused company that is working on developing innovative products for farmers. It has had some recent breakthroughs with their micro-nutrients and soil amendments which are currently in field trials. Given the expected shortage of water and growing prices of fertilisers world-wide, the company and its products present a promising opportunity for small and large farmers to improve the crop yield and lower their input cost per acre by employing soil amendments that help with more efficient use of fertilisers and water in plants.
Next, four young entrepreneurs at Eyedeus, aided by decades of joint research in computer vision, have developed technology that enables mobile devices to have eyes and intelligently process real-world imagery using an increasingly powerful mobile processors. Unlike the cameras on mobile devices that just allow ‘dumb’ recording of images or videos, Eyedeus technology allows developers to augment the reality around users. The company’s first product, called ‘Groopic’ (beta available on the AppStore) is already getting rave reviews. Groopic allows group pictures to be taken in a way never before possible. The person taking the picture can now be part of the group picture, go figure!
Eyedeus, by the way, is part of a full-service technology incubator called Plan 9, that’s a visionary initiative of the government of Punjab, and it hosts at least a dozen other start-ups alongside Eyedeus, working on equally innovative products and services.
Similarly, Invest2Innovate is another accelerator that is supporting at least five entrepreneurial ventures focused on businesses with a large social impact.
Third is a new age production house called JugnooMedia, developing interactive, digital musical toys for mobile devices with an aim of providing toddlers and young children new avenues of learning that are more fun and effective than the traditional, classroom teaching. The demos of their first title are very impressive and the company has announced that it will be released on the Apple AppStore and Android Marketplace soon.
And finally, there is BLISS – a social venture that is aimed at improving the livelihood of women in Pakistan alongside educating them. BLISS has already done a pilot program in a small village of Pakistan where women were taught embroidery skills alongside formal school education in the first phase. In the second phase, BLISS provided the same women an opportunity to co-op with the company and develop handbags designed by professional designers which were then marketed by BLISS through its online store as well as an impressive list of global brand ambassadors. The women who made the bags got the lion’s share of the revenue from those sales and the rest of the money is being used to sustain the operations of the organisation and scale the program.
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The next time a story is told about the problems Pakistan is having with the political instability, corruption, energy shortage and terrorism the world must know, that to the same land belong some of the best, battle-tested and inventive entrepreneurs working on shaping the future of the world!
http://blogs.tribune.com.pk/story/15611/pakistan-more-than-just-drones-blasts-and-terrorism/
Here's Daily Times on Pak food exports:
ISLAMABAD - The food exports of the country during first half of financial year 2012-13 increased by 4.82 percent as compared to same period of last year. The exports of overall food group were recorded at $2,054 million during July-December (2012-13) against the exports of $ 1,959 million during July-December (2011-12).
According to data of Pakistan Bureau of Statistics (PBS), the food exports from the country on month on month basis also increased by 14.34 percent and 18.01 percent during December 2012 when compared with December 2011 and November 2012 respectively.
The food exports increased from $ 384.493 million in December 2011 and $ 374.465 million in November 2012 to $ 441.923 million in December 2012.
The major food items which recorded increase in their exports during the first six months of current financial year over same period of last year include sugar (100%), meat and meat preparations (43.74%), fish and fish preparations (2.64%), vegetables (38.28%), spices (25.07%), oil seeds, nuts and kernels (41.6%%) and all other food items (17.31%).
Similarly the food items which recorded decrease in their exports include rice (12.33%), fruits (1.77%), pulses (56.68%), tobacco (40.91%) and wheat (61.49%). The overall exports from the country witnessed growth of 7.58 percent during the period July-December (2012-13) as compared to same period of last year.
Exports from the country during July-December (2012-13) were recorded at $ 12.0513 billion against the exports of $ 11.201 billion during the same period of last year.
http://www.pakistantoday.com.pk/2013/01/23/news/profit/food-exports-post-an-increase-of-4-82/
Here's a BR story on Tetrapak growth in Pakistan:
Tetra Pak sees tremendous potential for growth in Pakistan as its liquid packaged food industry (dairy and beverage) will grow on an average compound annual growth rate of 15 to 16 percent over the next five years. Pakistan is the 6th largest market in terms of population and for the past several years has consistently registered one of the highest growth rates globally.
Tetra Pak factory will meet the rapidly growing demands of Pakistan's dairy and beverage industries as well as growing demand from other emerging markets in the cluster 'greater middle east', said Tetra Pak factory Production Manager Ihsan Ullah Khan while talking to members of the Agricultural Journalists Association (AJA) at factory premises on Wednesday.
He said that the factory which was constructed with an investment of over Rs 10 billion started its operations on December 01, 2010 has been declared 'Factory of the Year Award' in recognition of its achievement in operational efficiency, environment and safety performance within two years since it commenced operation. The factory has production capacity of eight billion packages per year, with the potential to double production to 16 billion packages.
He said hard work and dedication of local people have proved Tetra Pak administration right in their taking decision of investment in Pakistan. By pursuing continuous improvement in operation, our factory has outperformed previous benchmarks in world class performance and productivity. "I am pleased to be a part of the winning team and I believe, passion of our people and mental fortitude is the driving force behind our success in such a short span of time," remarks Tahir Hafeez, Factory Director.
The selection process for the Factory of the Year Award is based on a selection of key performance indicators, employee satisfaction and management voting. The Lahore factory is World Class Manufacturing (WCM) certified, following manufacturing best practices, for leaner production such as limiting waste level to a minimum, reducing energy consumption by almost 20 percent from 2011. The factory has successfully established a working environment that aims at zero accidents.
http://www.brecorder.com/agriculture-a-allied/183/1151541/
Here's ET on Coke's planned investment in Pakistan:
KARACHI: Optimistic about its growth prospects in Pakistan, the Coca-Cola Company – one of the world’s largest beverage companies – will invest $379 million on manufacturing facilities across Pakistan over the next three years to expand its business, the company’s Pakistani subsidiary announced on Monday.
The announcement comes on top of the $172 million already invested by Coca-Cola in the country in 2011. The beverage giant will be spending the money on three new bottling plants, one each in Karachi, Multan and Islamabad. The announcement was made in the ground-breaking ceremony of the Multan plant on Monday.
The funds will be utilised for expansion and bringing about infrastructure changes and systemic improvements in the Coca-Cola system, an official press release said.
The expansion plans come as rising demand makes it difficult for Coca-Cola to keep pace with its existing production capacity in Karachi and Punjab, according to company officials. A decent growth in its top-line may also be another factor encouraging more investments.
Owing to its strategic location, Multan can not only serve southern and northern Punjab – which alone accounts for more than 60% of Coca-Cola’s business – but can also cater to Karachi’s market, company spokesman Fahad Qadir told The Express Tribune.
Greenfield investment refers to new foreign direct investment that will be utilised in setting up a completely new project, as opposed to an existing business expanding operations with its free cash flows.
Qadir says the plant will be fully equipped with state-of-the-art production equipment and product warehousing facilities. The plant will also have a much higher manufacturing capacity, he said.
Besides the three Greenfield plants announced, Coca-Cola Pakistan already operates six bottling factories in Pakistan, located in Karachi, Gujranwala, Multan, Lahore, Rahimyar Khan, and Faisalabad. It buys close to Rs13 billion in raw materials from around 300 local suppliers.
The Coca-Cola System, according to the press release, provides direct and indirect employment to more than 8,000 people in Pakistan; while another 35,000 people are employed through its supply chain, and another 100,000 benefit through employment in allied industries.
Coco-Cola Pakistan refused to comment on its revenues: but our sources say the company earned over Rs50 billion in revenues for the financial year ending June 30, 2012; a 55% increase when compared with the previous year. It also paid Rs10 billion in taxes.
http://tribune.com.pk/story/515776/coca-cola-announces-379m-expansion-plan-for-pakistan/
Here's a Nation newspaper article on food marketing in Pakistan:
FOOD marketing is such a process that usually brings together the producer and consumer. The marketing of even a single food product can be a convoluted process involving many producers and companies. For example, Pakistan has seen a fabulous growth in frozen foods market by the development of the ice-cream segment. The frozen food ice cream segment’s market size enormously expanded as a result of two entrants: a multinational company and a large local company.
Product development is systematic, commercially sloping way to develop products and processes satisfying a known or alleged consumer need. There are four basic stages for every product development process: product strategy development, product design and development, product commercialisation and product launch or post-launch. The vital test of product development occurs in the market and a new product can only be considered flourishing if it is a market and financial success.
There are three historical phases of frozen food marketing: the transportation phase, the distribution phase and the capacity of the retailers.
Today foods are not anticipated to merely satisfy hunger and to endow with necessary nutrients for humans but also to prevent nutrition-related diseases and improve physical and mental well-being of the consumers. The increasing demand of such ‘functional foods’ can be explained by the increasing cost of healthcare, the sturdy increase in life expectancy and the desire of older people for enhanced quality of life in later years.
Product development is now indispensable to scrutinize the issue of what constitutes a new or innovative product. Newness of a product may be judged differently according to those who pick it.
To mull over food product sales it is essential to look at the retail sector; this sector is characterised by intense competition and the dominant position held by supermarkets in many regions of the Pakistan. There is competition not only for sales between retailers but competition between food product suppliers. Pakistan has about 200,000 stores in the urban markets. These account for 90pc of the trade.
The development of the frozen food industry impacts farmers. The farmer directly benefits as he gets a better price, whether he owns a cow/buffalo or grows wheat and grains used in poultry feeds, or produces fruits and vegetables.
Pakistan has abundant sources of raw material. It is the 4th prevalent producer of milk and is one of the top ten producers of poultry in the world. 40pc of the horticulture produce is exhausted in post-harvest losses.
The global market of frozen vegetables alone is more than $3 billion with Japan and USA as the biggest importers of frozen vegetables while Malaysia imported $23 million worth of frozen vegetables in 2004.
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/06-Mar-2013/development-marketing-of-food-products-in-pakistan
Here's PakObserver on US help to improve Pak agri productivity:
Tuesday, March 12, 2013 - Islamabad—The U.S. Agency for International Development (USAID), the International Maize and Wheat Improvement Center (CIMMYT), and the Pakistan Agricultural Research Council (PARC) launched a new project to expand the use of modern technologies in Pakistan’s agriculture sector.
“Boosting Pakistan’s economy is one of our top assistance priorities. That’s why this project will work to modernize agricultural practices to increase the production and quality of livestock and horticultural goods. This in turn will enhance economic development in the country,” said USAID Country Director Jonathan M. Conly at the launch of the project in Islamabad on March 8.
Innovative technologies, introduced in Pakistan with support from the U.S. Government, spurred the Green Revolution in the 1960s and 1970s. The adoption of improved rice and wheat varieties, combined with strategic policies and investments, led to a doubling of yields and output in those two decades. With investment in research, Pakistan transformed its agricultural sector into a driver for economic growth.
Currently, Pakistan’s agricultural sector is growing at a much slower pace than other sectors. “Pakistan’s agricultural productivity has fallen behind comparable countries with similar agro-ecologies,” said Thomas Lumpkin, Director General of CIMMYT. “There is a tremendous potential for growth, but we must act now.”
Through its new four-year, $30 million project, USAID will sponsor research to encourage adoption of new technologies in agriculture, such as laser land leveling, zero tillage, residue management, introducing short duration legumes into rice-wheat cropping systems, and custom service systems for machinery.
The project will also offer short and long-term training. The U.S.-funded project will be implemented by CIMMYT and PARC in cooperation with the International Livestock Research Institute, the World Vegetable Center, the International Rice Research Institute, and the University of California, Davis.
Promoting economic growth is one of the many ways that the United States is helping to create a brighter future for the people of Pakistan. The United States funds large-scale energy projects that will provide electricity to two million households by the end of 2013. The U.S. has rebuilt and renovated 800 schools and has provided scholarships to 12,000 students to attend universities in Pakistan.
http://pakobserver.net/detailnews.asp?id=199817
Here's Ashby Monk of the Institutional Investor:
Pakistan: Qatar's Hassad Food is apparently interested in some food assets in Pakistan, as it's just opened an office in Lahore. This comes on the heels of the announcement yesterday that the Kuwait Investment Authority has signed an MoU with Pakistan’s Board of Investment. Is Pakistan the hot new frontier market? Or is this about food security?
- Emerging Markets: Survey shows emerging markets are the key for pensions trying to meet their return expectations. ...
http://www.institutionalinvestor.com/blogarticle/3169873/The-Daily-Brief-SWFs-Looking-To-Pakistan.html
Here's a PakistanToday report on raising wheat yield in Pakistan:
American scientists and Pakistani wheat experts are collaborating to increase Pakistan’s wheat harvest and ensure greater prosperity to farmers nationwide.
A bi-national team of scientists, sponsored by the US Department of Agriculture (USDA), met in Faisalabad last week to evaluate wheat varieties for disease-resistance, according to a statement issued by the US Embassy.
In order to determine which wheat varieties will perform best in Pakistan’s unique ecosystem, US and Pakistani researchers studied the effects of heat and other types of environmental stress on the different varieties of wheat that can be planted in Pakistan.
USDA, through its Wheat Productivity Enhancement Project (WPEP), currently helps evaluate 60 wheat varieties planted in 115 wheat trials throughout Pakistan. In order to increase the quality of this joint research, last week USDA also provided Pakistani research institutions specialized wheat planting and harvesting equipment. The new machines, which replaced equipment over 25 years old, will allow scientists to study more wheat varieties each year and more rapidly improve Pakistani farmers’ harvest yields.
“Wheat is critical to the food security of both Pakistan and the United States,” said USDA Plant Health Advisor Ian Winborne after a ceremony at Ayub Agricultural Research Institute (AARI) celebrating the handover of the new equipment. He added, “Lasting links between Pakistani and US scientists can help improve and protect agricultural harvests in both our countries.”
WPEP facilitates scientific collaboration between USDA, the International Maize and Wheat Improvement Center (CIMMYT), and Pakistan’s national wheat programs. WPEP funds scientific exchanges to develop, introduce, and test disease-resistant wheat varieties; improve agronomic practices; and upgrade research capacity in Pakistan.
This initiative is just one part of a comprehensive US economic growth assistance program which includes expanding irrigation by more than 200,000 acres near the Gomal Zam and Satpara dams; constructing more than 1,000 km of roads to connect communities and facilitate trade; modernizing dairy farms in Punjab; and launching private equity investment funds to help small and medium businesses grow.
http://www.pakistantoday.com.pk/2013/03/20/news/profit/us-pakistani-scientists-increase-pakistans-wheat-harvest/
Here's a Nation report on Nestle's $104 million investment in Pakistan:
AHORE – SALMAN ABDUHU - The Nestle Pakistan has announced the completion of its new milk powder drying facility plant with additional investment of $104 million at Nestle Sheikhupura factory.
Nestlé Executive Vice President and Operations and Globe System In-charge Joze Lopez, who is on three three-day visit to Pakistan, inaugurated the $104 million Egron Project and visited the whole plant.
Lopez, addressing the opening ceremony, said that the existing Milk Powder Plant has now been modified with new technology and has an additional yearly capacity of 30,000 tons. The power generation capacity and waste water management system have also been upgraded and additional filling lines have been set up, he added.
He stated the Nestlé is the largest food and beverage company in the world and the Sheikhupura dairy, juice and water factory embodies Nestlé’s increased investment in Pakistan. As part of its three-year plan to expand the production capacity in the country, Nestlé has invested a total of $148 million over the past two years in various factory expansion projects to meet rising consumer demands.
He added that wherever Nestlé is present, the company works and invests in the long term. We are convinced that in order to be successful in the long-term we have to create value for our shareholders, as well as for society. This Creating Shared Value approach encourages businesses to create economic and social value simultaneously by focusing on the social issues that they are uniquely capable of addressing. He observed that Nestlé Pakistan is committed to creating shared value for the communities it works and lives with. The company has made many contributions in this regard, by providing free technical and veterinary advisory and training support to thousands of dairy farmers in the milk districts who now have more sustainable opportunities to gain their living.
Lopez said, “Pakistan is an important growth market for us and we are dedicated to meet the growing demands of our consumers. Major capacity increases, such as the one just inaugurated in Sheikhupura, allow us to constantly upgrade our facilities to the latest standards in global technology.”
MD Magdi Batato, on this occasion said that Nestlé Pakistan is the leading food and beverage company in Pakistan and meets international standards in the manufacturing of its products. In 2012, the company grew by 22 per cent to reach an annual turnover of Rs79 billion (Approximately $800million). Nestlé Pakistan is serving the Pakistani consumers since 1988 and it also associates itself with 200,000 farmers in collecting milk and engages in a number of rural development programme for community development.
“Our reality is ‘Har Dam Pakistani’, (Every Moment Pakistani) and we are delighted to provide our consumers with products manufactured in Pakistan. More than one million Pakistanis, mostly dairy farmers, participate in our value chain and this investment is a further commitment to Pakistan and its people, and to our vision of providing Behtar Kal Hamara, (A Better Tomorrow For Us) to all,” said Magdi Batato, Managing Director, Nestlé Pakistan.
http://www.nation.com.pk/pakistan-news-newspaper-daily-english-online/business/23-Mar-2013/nestle-brings-104m-additional-investment-to-pakistan
Unilever announces $514 million investment in Pakistan, reports News Tribe:
Karachi: Unilever Plc., through its wholly owned subsidiary, Unilever Overseas Holdings Limited on Tuesday committed to invest circa €400 Million (US$514m Million, Rs.50 Billion) in acquiring the 24.92% of issued shares in its Pakistan subsidiary, Unilever Pakistan Limited, that it does not already own.
This follows price and buyout threshold determined by the Special Committee constituted at the Karachi Stock Exchange as per applicable delisting regulations.
€400 Million is the single largest foreign direct investment in the recent history of Pakistan and underlines Unilever’s commitment to a business established in the country in 1948.
For the last 65 years, Unilever has been working to create a better future every day for millions of Pakistanis, with brands and services that help people make sustainable living a common place. There is hardly a household that does not daily use one of its 27 brands in the home care, personal care, foods, beverages and ice cream categories.
It directly employs 2,000 individuals in addition to generating a further 6,000 jobs in the value chain. Over 95% of what it sells is manufactured in Pakistan. The company ranks as the Most Preferred Employer amongst business graduates.
Under the Unilever Sustainable Living Plan, the company focuses on improving health and well-being, enhancing livelihoods and reducing the environmental impact.
The aforementioned investment is subject to approval by Unilever Pakistan’s shareholders at an Extraordinary General Meeting to be held shortly.
http://www.thenewstribe.com/2013/04/02/unilever-commits-e400-million-investment-in-pakistan/
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