Wheat Consumption Determinants and Food Security Challenges: Evidence from Pakistan

Date

2022-03-03

Authors

Shaheen, Sania
Almas, Lal
Usman, Muhammad

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Abstract

Globally, wheat is one of the most widely cultivated staple crop and extensively consumable staple food. It plays a vital role in overcoming food security. Wheat is one of the primary food source of Pakistan. In the beginning of time-period from 1975 to 2020 Pakistan had achieved near self-sufficiency in wheat production. It has been observed that during this period, Pakistan was somewhere a net importer and somewhere a net exporter. This trend shows an irregularity in the food policy of Pakistan. The wheat production and consumption gap is expected to further increase in the coming years due to higher population growth that will exert continuous pressure on wheat consumption that would be a reason for food insecurity issues in Pakistan in the upcoming years. A sustainable food security policy is required to overcome the upcoming food security issues in Pakistan. This study is conducted to explore the determinants of wheat consumption in Pakistan as well as to analyze the own price, cross-price elasticity, and income elasticity of wheat demand. For estimation purpose, annual time series data were used covering the period from 1972-2020. The Autoregressive Distributed Lag approach (ARDL) econometric technique was applied to investigate the presence of long-term association between wheat demand and wheat consumption determinants. The estimated findings of wheat prices, real GDP, and population highlight that wheat is the basic necessity commodity in Pakistan. Further, the results of rice prices and corn consumption reveal that rice and corn commodities are substitutes to wheat with less elastic demand in Pakistan. The estimated result of wheat imports exhibits a direct and significant impact on wheat consumption. Forecasting graphical analysis shows that in 2020, wheat consumption in Pakistan was 26 million metric tonnes (MT) and increasing at an increasing rate. In 2050 wheat consumption would be 38 million MT (Production 32 million MT) because of the pressure of population. The forecasting analysis results highlight that Pakistan needs 57 million MT of wheat to feed the 491million population of Pakistan in 2100. However, in 2100 the forecasted wheat production is 43 million. Overall, the results suggest that domestic efforts required to reducing the expected gap between wheat demand and supply, which may be decreased through the application of latest innovative production techniques, advanced varieties of wheat, land expansion, and exploring the additional water resources for irrigated agriculture. Based on empirical findings, it is recommended that policymakers, Pakistan government, and stakeholders required to concentrate on inclusive policy for parallel wheat, rice, and corn consumption. Additionally, this study suggested that policymakers, Pakistan government, and stakeholders must pay attention on exploring the ways to raise domestic production of wheat in order to decrease imports of wheat, saving of effective foreign exchange, and to resolve the upcoming food security issues in Pakistan. Keywords: Wheat Consumption Determinants, Own Price Elasticity, Cross Price Elasticity, Income Elasticity, Wheat Supply and Demand Gap, Food Security, Autoregressive Distributed Lag (ARDL).

Description

Secondary Data sources include national and international agencies

Keywords

2022 Faculty Research Poster Session and Research Fair, West Texas A&M University, Department of Agricultural Sciences, Poster

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