PAR News - Wed, 27 Mar 2024

TOPLINE

• Around 47,000 wheat sacks worth Rs 800 million have gone missing from a government warehouse in Sindh's Khairpur district. The Sindh Food Department suspended 3 officials in response to the incident.
• Pre-sales of cotton for the 2024-25 season have begun despite weather delays, with rates ranging from Rs 10,000-11,000/40 kg in Sindh and Rs 9,500-10,000/40 kg. The Spot Rate remains steady at Rs 21,500/maund, with Polyester Fiber priced at Rs 367/kg.
• PIACL's Board approved privatization plans, to be filed with SECP, while seven investors eye PIA and airports, aiding efforts to boost reserves amidst a balance of payment crisis. The Federal Cabinet approved the 11-member PIA holding company board, marking a crucial phase in privatization, with approval obtained through Cabinet.
• A looming water shortfall of up to 25% is expected in April and May, worsening in June due to low snowfall and melting snow in northern regions. Tarbela and Mangla dams face a severe shortage if there's no rain in June.
• Prime Minister Shehbaz Sharif announced blue passports and honour cards for award-winning taxpayers, along with honorary ambassador status for top taxpayers.
• Indian exporters are facing demands from the customs department to pay duty differences on rice exported in the last 18 months, following the imposition of export duties to control domestic prices. This move, requiring exporters to consider transaction value, could significantly affect rice shipments from India.

COMMODITIES - CROPS, LIVESTOCK & HORTICULTURE

• Wheat Scandal: 47,000 Sacks Missing in Sindh - Around 47,000 wheat sacks worth Rs 800 million have gone missing from a government warehouse in Sindh's Khairpur district. The Sindh Food Department suspended three officials in response to the incident, which is not the first of its kind, as a similar disappearance occurred in Naushehro Feroze in 2022. [ARY] [PO] [ProPakistani]
• Punjab Cabinet Forms Wheat Procurement Committee: The Punjab cabinet forms a ministerial committee, headed by the food minister, to advise on wheat procurement, with members from finance, agriculture, information, and industries ministries. Chief Minister Maryam Nawaz stresses consulting with stakeholders and using technology for crop assessment. [ET] [ET]
• Cotton Pre-sales Begin Amid Weather Delays: Pre-sales of cotton for the 2024-25 season have begun despite weather delays, with rates ranging from Rs 10,000-11,000/40 kg in Sindh. Cotton rates in Sindh and Punjab are between Rs 19,000-22,000/maund, while Phutti prices in Punjab range from Rs 9,500-10,000/40 kg. The Spot Rate remains steady at Rs 21,500/maund, with Polyester Fiber priced at Rs 367/kg. [BR]
• Fruit Vendors' Traffic Nuisance in Karachi: Fruit vendors resorting to selling their leftover stock along busy highways, roads, and bridges has become a nuisance for commuters due to resulting traffic congestion. Karachi's growing migrant population has led to an increase in vendors selling fresh produce, exacerbating the issue as they now operate beyond sunset, causing prolonged traffic jams. [ET]
• Pakistan Cement Dispatches: March Outlook - Local cement dispatches in Pakistan are forecasted to rise by 10% to 14% in March 2024, reaching around 3.20 million tonnes on a month-on-month basis, with a projected decline of 3% to 7% year-on-year. February 2024 saw lower sales due to the election month, with dispatches totaling 2.86 million tonnes compared to the five-year average of 3.61 million tonnes for February. [ET]
• Local Gold Prices Surge, Global Market Steady: Gold prices surged in the local market on Tuesday, with a Rs 1,200 increase per tola and a Rs 1,029 increase/10 grams, reaching Rs 229,400 and Rs 196,674 respectively. The global market closed at $2,193 per ounce, up by $6, while silver remained stable in local and global markets. [BR]
• Tea Import: $436.7 million-worth of tea was imported during July-Feb 2023-24. [ET]

AGRI-INPUTS, WEATHER, WATER & POWER

• PIACL Board Greenlights Privatization: PIACL's Board approved privatization plans, to be filed with SECP, while seven investors eye PIA and airports, aiding efforts to boost reserves amidst a balance of payment crisis. The Federal Cabinet approved the 11-member PIA holding company board, marking a crucial phase in privatization, with approval obtained through Cabinet circulation after Prime Minister's permission. [BR] [BR] [BR] [Dawn] [ET]
• Looming Water Shortfall: A looming water shortfall of up to 25% is expected in April and May, worsening in June due to low snowfall and melting snow in northern regions. Tarbela and Mangla dams face a severe shortage if there's no rain in June. The Indus River System Authority is convening an advisory committee meeting on April 2 to address the issue. [ET]
• Gas Crisis Sparks Anger in City Residents: The city is experiencing visible anger among residents due to a gas crisis, resulting in hours-long load shedding and low pressure during Ramadan. Despite Sui Southern Gas Company's (SSGC) announcement to ensure gas supply during Sehri and Iftar timings, many areas are facing low pressure issues, prompting residents to opt for LPG cylinders as an alternative. [Dawn]
• OGDCL Strikes New Reserves: Oil and Gas Development Company Limited (OGDCL) announced the discovery of new hydrocarbon reserves at the Togh-02 well in Kohat district, Khyber Pakhtunkhwa. The well, operated jointly by OGDCL (75%) and Saif Energy Limited (SEL) (25%), reached its total depth at 2,600 meters and flowed at a rate of 2.842 million standard cubic feet per day (mmscfd) of gas and 28 barrels per day of condensate. [Dawn] [The News]
• CPEC Phase 2 Agreement Amid Tragic Attack: Prime Minister Shehbaz Sharif announced plans to sign an agreement with China for the second phase of CPEC, focusing on starting the ML-I rail project and establishing economic zones nationwide. The announcement was made during a 'Tax Excellence Awards' ceremony, shortly before a tragic suicide attack in Shangla claimed 6 lives, including 5 Chinese workers. [Dawn]
• Gwadar Power Plant: Accelerate Construction - Federal Minister Ahsan Iqbal urged authorities to accelerate the construction of the Gwadar Power Plant during a meeting where he chaired a review of its progress. The meeting, attended by ministry officials, PPIB managing director, Chinese Embassy Minister Counsellor Yang Guangyuan, and other stakeholders, focused on expediting the project. [BR] [ET]
• Export Boost: Wharfage Cut - Maritime Affairs Minister Qaisar Ahmed Sheikh announced a 50% reduction in wharfage charges for exporters at Karachi Port and Port Qasim, responding to the Prime Minister's directive to support the export sector. This comes amidst complaints from the business community about steep cargo handling fee hikes, notably by Karachi Gateway Terminal Limited. [The News]
• Challenges for Local Auto Industry: The local automobile industry is struggling due to a surge in the import of used cars and SUVs after the withdrawal of regulatory duties and additional customs duties. Abdul Waheed Khan, Director General of PAMA, highlighted that this removal has put locally produced vehicles at a competitive disadvantage without reinstating higher taxation. [BR]

AGRI UPDATES & PAKISTAN POLICY

• No IMF Program to Hinder Growth - PM Shehbaz Sharif emphasized that any IMF program shouldn't hinder economic growth, rejecting it as an excuse. The government plans to discuss an Extended Fund Facility (EFF) with the IMF in Washington next month to address the economic crisis. [Dawn]
• Taxpayer Awards: Prime Minister Shehbaz Sharif announced blue passports and honour cards for award-winning taxpayers, along with honorary ambassador status for top taxpayers. Award recipients will receive blue passports, while top taxpayers will get 'Pakistan Honour Cards', and category leaders will be designated as honorary ambassadors for Pakistan. [BR] [ET]
• US Opposes Pakistan-Iran Pipeline, Sanctions Warning: The US expressed opposition to the Pakistan-Iran gas pipeline project and warned of sanctions risks with Tehran. This followed Petroleum Minister Musadik Malik's statement that Islamabad would seek exemption from US sanctions for the project. [Dawn]
• Pak Rupee Up, Bond Plans Hit by Terror Concerns: The Pakistani rupee strengthened against the US dollar, nearing Rs 277 in the interbank market on Tuesday, driven by IMF inflow hopes. However, recent terrorist attacks and the killing of five Chinese engineers may disrupt the government's plan to launch $300 million Panda bonds in China. The State Bank of Pakistan reported the dollar price falling to Rs 278.08, marking a five-month low against the rupee. [Dawn]
• Pakistan Urges Swift UN Gaza Ceasefire Resolution: Pakistan and other nations urge swift implementation of a UN Security Council resolution for a Ramazan ceasefire in Gaza, emphasizing immediate release of prisoners. UN Secretary-General stresses resolution's enforcement for ceasefire and prisoner release, with diplomats affirming Security Council's binding nature, obligating Israel to halt Gaza military campaign. [Dawn]

INTERNATIONAL – OVERVIEW & MARKET OUTLOOK

• Israeli Genocide: 12 drowned and at least 6 died in stampedes during efforts to retrieve airdropped aid in Gaza. The incident occurred in northern Gaza on Monday as people rushed to collect packages. The UN urged Israel to lift a ban on food deliveries to northern Gaza by UNRWA due to famine concerns. [Dawn]
• Russia Accuses Ukraine, US, UK of Concert Hall Attack: Russia's security agency director accused Ukraine, the US, and Britain of involvement in the Moscow concert hall attack, which killed 139 people. Ukraine and Britain denied the claims, calling them lies and "utter nonsense" respectively. The director alleged Islamist radicals orchestrated the attack with support from Western special services. [Dawn] [Al Jazeera]
• Customs Demands Hit Indian Rice Exporters: Indian exporters are facing demands from the customs department to pay duty differences on rice exported in the last 18 months, following the imposition of export duties to control domestic prices. This move, requiring exporters to consider transaction value, could significantly affect rice shipments from India, the world's largest rice exporter. [BR]
• China Challenges US at WTO Over EV Subsidies: China has filed a dispute against the US at the WTO over alleged discriminatory subsidies in the electric vehicle industry. The US Inflation Reduction Act, which offers tax credits for electric vehicle purchases and renewable energy production, is at the center of the conflict. [Dawn]
• Sri Lanka Cuts Rates Amid China Debt Talks: Sri Lanka's central bank cut interest rates as PM Dinesh Gunawardena negotiated a debt restructuring deal in China, crucial for the IMF bailout. Gunawardena's visit to Beijing indicates the final stages of debt restructuring, with China as the main creditor. [BR]
• Oil Prices Stable Amid Ukrainian Attacks: Oil prices saw little change on Tuesday as investors weighed the impact of recent Ukrainian attacks on Russian refinery capacity, while a slightly weaker US dollar provided some support. Front-month Brent crude futures fell by 12 cents to $86.63 a barrel, while US West Texas Intermediate (WTI) crude futures rose by 13 cents to $82.08. [BR]

PAKISTAN - REMAINDERS

• Tragic Attack: Engineers Killed in Besham - 6, including 5 Chinese engineers were killed in a suspected suicide attack in Besham, Khyber Pakhtunkhwa. The victims, en route to Kohistan from Islamabad, were hit by an explosive-laden vehicle, plunging into a ravine and catching fire. Relief operations were initiated by Khyber Pakhtunkhwa police. [BR] [Dawn] [Dawn] [ET] [ET]