0% found this document useful (0 votes)

160 views83 pages

Pakistan Agribusiness Report Q2 2025

The Pakistan Agribusiness Report Q2 2025 highlights strong agricultural output due to favorable weather and government support, particularly in grains and rice, although cotton production faces challenges. The report forecasts sustained yield growth through 2029, driven by rising incomes and urbanization, despite potential risks from currency weakness and political instability. Key insights include the impact of food price inflation on domestic demand and the importance of improving agricultural infrastructure and practices to enhance productivity.

Uploaded by

Rupesh Nanwani

We take content rights seriously. If you suspect this is your content, claim it here.

Available Formats

Download as PDF, TXT or read online on Scribd

0% found this document useful (0 votes)

160 views83 pages

Pakistan Agribusiness Report Q2 2025

Uploaded by

Rupesh Nanwani

We take content rights seriously. If you suspect this is your content, claim it here.

Available Formats

Download as PDF, TXT or read online on Scribd

Q2 2025

[Link]/bmi

Pakis
akistan
tan
Agribusines
gribusinesss R
Report
eport
Includes 5-year forecasts to 2029

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Powered by TCPDF ([Link])
Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Contents
Key View............................................................................................................................................................................................ 4

SWOT .................................................................................................................................................................................................. 5
Agribusiness SWOT ...................................................................................................................................................................................................................... 5

Industry Forecast........................................................................................................................................................................... 6
Rice..................................................................................................................................................................................................................................................... 6
Grains...............................................................................................................................................................................................................................................11
Cotton .............................................................................................................................................................................................................................................15

Commodities Price Analysis ....................................................................................................................................................20

Monthly Commodities Strategy: Solid Gains Overall In February, Barring Some Weakness In Oil And Grains......................................20

Upstream Analysis ......................................................................................................................................................................33

Asia Machinery Outlook: Mixed Performance In 2025 As Indian Sales Outperform .......................................................................................33
Asia GM Outlook: Government Regulation Encouraging Adoption, But Cultivation Faces Strong Opposition....................................43
Asia Fertiliser Outlook: Application Growth Under Pressure As Farming Costs Remain High .....................................................................49

Downstream Analysis ................................................................................................................................................................59

Food .................................................................................................................................................................................................................................................59

Regional Overview.......................................................................................................................................................................63
Five Key Themes For Asia Agribusiness.............................................................................................................................................................................63

Competitive Landscape.............................................................................................................................................................75

Pakistan Demographic Outlook..............................................................................................................................................76

Agribusiness Methodology ......................................................................................................................................................80

© 2025 Fitch Solutions Group Limited. All rights reserved.

All information, analysis, forecasts and data provided by Fitch Solutions Group Limited are for the exclusive use of subscribing persons or organisations (including those
using the service on a trial basis). All such content is copyrighted in the name of Fitch Solutions Group Limited and as such no part of this content may be reproduced,
repackaged, copied or redistributed without the express consent of Fitch Solutions Group Limited.

All content, including forecasts, analysis and opinion, is based on information and sources believed to be accurate and reliable at the time of publishing. Fitch Solutions
Group Limited makes no representation or warranty of any kind as to the accuracy or completeness of any information provided, and accepts no liability whatsoever for
any loss or damage resulting from opinion, errors, inaccuracies or omissions affecting any part of the content.

This report from BMI – A Fitch Solutions Company is a product of Fitch Solutions Group Limited; UK Company registration number 08789939 ('FSG'). FSG is an affiliate of
Fitch Ratings Inc. ('Fitch Ratings'). FSG is solely responsible for the content of this report, without any input from Fitch Ratings.

Copyright © 2025 Fitch Solutions Group Limited.

This commentary is published by BMI – A Fitch Solutions Company, and is not a comment on Fitch Ratings' Credit Ratings. Any comments or data included in the report are solely derived from BMI and independent
sources. Fitch Ratings analysts do not share data or information with BMI.

[Link]/bmi 3

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Key View
Key View: The Pakistani grains and cereals output in 2024/25 was strong owing to good weather, healthy increases in area planted,
strong government supported and profitability of crops. In 2024/25, Pakistani Rice and wheat yields were strong as the dollar-
strapped government encouraged cash-crop plantings and trade. That being said, efforts to revive local cotton production have
once again stalled due to pest concerns resulting in increased imports. Looking forward to 2028/29 and beyond, we expect
sustained yield growth across all crops in Pakistan as public and private-sector initiatives targeting improved farming techniques
remain pronounced. Demand growth will be bolstered by rising incomes, urbanisation and favorable demographic trends.

Pakistan - K
Key
ey Agribusiness FFor
orecasts
ecasts (2022-2029)
Indicator 2022 2023e 2024e 2025f 2026f 2027f 2028f 2029f
Agribusiness Mark
Market
et V
Value,
alue, USDmn 63,840.7 51,504.7 56,423.6 51,477.0 51,797.9 51,728.9 52,019.5 52,376.2
Agribusiness mark
market
et vvalue,
alue, USD, % yy-o-y
-o-y -8.1 -19.3 9.6 -8.8 0.6 -0.1 0.6 0.7
Agribusiness Mark
Market
et V
Value,
alue, USD, % of GDP 17.4 13.9 16.0 14.6 13.9 14.0 14.4 14.8
Wheat self sufficiency
sufficiency,, % 99.1 91.0 93.3 101.4 100.1 97.0 97.3 97.4
Corn self sufficiency
sufficiency,, % 108.2 115.6 105.8 103.1 105.4 101.9 98.4 95.1
Barley self sufficiency
sufficiency,, % 50.7 88.9 118.5 115.6 112.8 110.0 107.4 104.7
Ric
Ricee self sufficiency
sufficiency,, % 239.1 186.5 246.5 243.9 241.5 237.9 234.4 230.8
Cotton self sufficiency
sufficiency,, % 56.1 44.8 72.2 55.5 64.0 63.8 63.0 64.4
e/f = BMI estimate/forecast. Source: USDA, BMI

Latest Updates And Structural Trends

1. Macroeconomic Outlook

Pakistan’s economy accelerated in FY2023/24, and we forecast real GDP growth in FY2024/25 to come in at 3.22%. In our view, low
investment levels, weak exports and challenges and limitations on the agricultural sector will continue to weigh on stronger
headline gains. Risks are weighed to the downside as the market is exposed to internal challenges, political gridlocks and debt-
related concerns.

2. Currency Weakness Will Complicate Outlook

We expect the Pakistani rupee to average PKR280/USD in 2025 and potentially fall to as low as PKR350.00/USD by the end of
2029. While the disbursement of funds from the IMF will see the rupee stabilise somewhat over the short term, we expect a
weakening trend to resume given elevated external debt repayment obligations, tight global monetary conditions and a persistent
current account deficit. Over the longer term, higher structural inflation relative to the US coupled with a lacklustre foreign direct
investment outlook will weigh on the rupee, but the undervaluation of the unit on a real effective exchange rate basis will limit the
pace of depreciation.

The risks to our growth forecast are weighted to the downside. Should there be delays in the fund disbursement from the IMF due
to heighted political uncertainty, this would lead to weaker investment appetite and further disruption to economic activity due to
shortages of forex. Risks to our rupee forecast are weighted to the downside. Delays in the disbursement of funds by the IMF could
see the currency weaken more sharply, as it triggers a loss of investor confidence.

[Link]/bmi 4

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

SWOT
Agribusiness SWOT

Strengths Weaknesses

• Robust crop yields in 2023/24 and 2024/25 driving export • Food price inflation weighs on domestic demand.
growth. • Flood damage to agricultural and logistical infrastructure has
• With a large and fertile land area, Pakistan is near self- been severe.
sufficient in most key agricultural products, including wheat, • Agriculture is underdeveloped as most farms are small and
rice and livestock. yields are low.
• Pakistan's population of nearly 200mn offers a largely • Infrastructure is poor and struggling to cope with the
untapped potential market for food products. increases in production necessary to meet the needs of the
• Bumper rice crops often result in strong exportable country's growing population.
surpluses. • Unreliable power supply causes difficulties for the cotton
• Government efforts support rice as the cash crop. sector.
• Fiscal problems continue to plague the Pakistani economy,
with the IMF reform package depressing short-term
spending.

Opportunities Threats

• Strong bumper crops to drive export revenues. • The political situation and the national economic situation
• Robust rice import demand from Mainland China to drive may deteriorate further over 2025 and weigh on yields and
export gains. investments.
• High food price to encourage additional plantings. • Elevated input costs could weigh additionally on yields in
• There is enormous room for improvement since agriculture 2025/26.
is underdeveloped. • Significant damage to the national economy following the
• If the government were to put programmes in place to train flood-related damages.
farmers and improve infrastructure, output could increase • Commodity price shocks pose downside risks, especially as
significantly. input costs surge.
• In the long term, rising incomes will allow Pakistanis to spend • Political challenges and balance of payments crisis linked to
more on food products. sovereign default present ever present downside risks.
• Demand for Pakistani agribusiness products, such as cotton • Given that Pakistan's most important trading partner is the
and sugar, is likely to increase with the rise of emerging EU, a prolonged economic crisis in Europe would have a
economies. serious impact on export earnings for cotton and other
agricultural products.
• The security situation in large parts of the country is likely to
put off large-scale investments in those areas and perhaps
the country as a whole.
• Any attempt on India's part to withdraw from or modify the
terms of the Indus Waters Treaty could undermine the
viability of irrigation-fed agriculture in large parts of Pakistan.
• While rice exports remain elevated, the country faces
increasing competition from Vietnam, Thailand and India.

[Link]/bmi 5

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Industry Forecast
Rice
Key View: The outlook for the 2024/25 Pakistani rice crop has been modestly revised to 9.5mn tonnes, down from 10.0mn tonnes
previously due to reduction in area and smaller yields. Nevertheless, Pakistan is on track for the second largest crop on record with
production growth being supported by elevated global demand, favorable weather and ongoing government incentives for cash-
crop farming. Rice production will remain on a steady uptrend over the forecast period to 2028/29 as the dollar-strapped
government encourages export of crucial cash crops. In our view, rice yields in Pakistan remain below global standards and there is
room for organic growth over the coming decade and beyond.

Latest Updates

• Rice harvest in 2023/24 reached 9.89mn tonnes, up by 34.7% y-o-y due to base effects, favourable weather and strong
plantings amid elevated prices. In the 2024/25 season, the rice harvest was previously forecast at 10mn tonnes but this has
been lowered to 9.5mn tonnes to account for modestly lower yield and incremental reduction in area allocated to rice.
• The elevated international export prices have been encouraging an expansion in domestic rice area in Pakistan, which will result
in above-trend output growth and a record harvest of 9.5mn tonnes in 2024/25 (November-October).
• Most recent trade data suggests that Pakistan exported a record high 6.55mn tonnes of rice in 2023/24 (October - November)
and the exportable surplus is presently pegged at around 5.8mn - 6.0mn tonnes in 2024/25.
• Rice demand should remain supported in 2025 on the back of population growth. Food price inflation will present negative risks.
• Rice exports in 2021 came in at USD2.15bn, up from USD2.10bn in 2020. Provisional data suggest that rice exports surged to
USD2.61bn in 2022 on the back of elevated global grain prices since the start of the Russian invasion of Ukraine. Most recent
mirror data from 2023 suggest rice exports at USD2.9bn in 2023 but this is subject to revision.
• The government has been looking to increase revenues from rice exports but flooding will limit growth over the near term.
• In Q1 2019, the government announced a USD2bn five-year agricultural plan that focuses on crop production and
diversification, but few details have been provided so far.
• As the leading producer and exporter of basmati and white long-grain rice, Pakistan will continue to be the US's dominant
supplier of these rice varieties.

[Link]/bmi 6

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Risks TTo
o Outlook
Risks
Shor
Shortt term Soaring input costs and fertiliser prices could result in reduced yields.
The export-led nature of Pakistan's rice industry makes it very vulnerable to fluctuations in global prices.
Robust food price inflation seen over the last 12 months will courage increased plantings in the upcoming season.
Long term Increasingly erratic weather patterns are likely to become a serious problem for the country. More frequent droughts in
the key agricultural states of Punjab and Sindh as well as the high likelihood of further floods present major downside
risks to our production forecast. Population pressure on water supplies could have an impact on irrigation systems.
A decision by the Indian government to withdraw from or modify the terms of the Indus Waters Treaty would threaten
the viability of irrigation-fed agriculture in large parts of Pakistan.
Pakistan has stalled on granting non-discriminatory market access or Most Favoured Nation status to India, but has not
ruled out doing so in the future. The liberalisation of trade between the two countries is opposed by rice industry groups
as it would allow exporters to re-sell India-sourced basmati rice when its price falls below the Pakistan-
sourced equivalent. This could pose a risk to domestic output, depending on the price differential.
Food security remains a concern in some parts of the country. The key drivers of this are limited livelihood opportunities,
high food prices and recurrent monsoon floods.

Source: FAO, BMI

Structural Trends

1. Government Looking To Address Structural Issues

Expansion in rice production is hindered by poor transport infrastructure and an unreliable power supply, which are persistent
concerns in Pakistan. Despite investment in milling, the quality of Pakistani rice is still considered poor. The fact that government
warehouses were badly affected by the floodwaters in 2010 and again in 2022 reinforces our view that inadequate storage remains
a major obstacle to the country's efforts to improve production.

While growers can put pressure on the authorities to invest in infrastructure, the current volatile political climate and a lagging
economy mean that such investments will not be a high priority for the government. However, we note that low oil prices have
given the government a valuable opportunity to increase support to the energy sector without drastically increasing prices for
consumers. Improved power supply would improve operating margins for rice millers, posing upside risks to our production
forecast.

We note that the government continues to work towards investing in rice production, especially as Islamabad's dollar-strapped
coffers have identified rice as a key cash crop with significant export potential. The bumper crop of just over 9.3mn tonnes in 2021/
22 was a result of three years of government efforts to bolster output with exports being the primary objective. That said, the 2022/
23 outlook was revised down due to flooding, with an estimated 21.7% decrease. However, a bullish trend reversal was observed in
2023/24 and is expected to remain pronouned in 2024/25.

[Link]/bmi 7

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Robust Prospects In 2024/25

Pakistan - Rice Exports, '000 tonnes

e/f = USDA estimate/forecast. Source: USDA, BMI

Pakistan As The Fourth Largest Exporter

Selected Markets - Rice Exports, '000 tonnes (2008-2023)

Source: USDA, BMI

2. A Highly Competitive Export Market

Pakistani rice producers face fierce competition from other major producers. India competes for the basmati rice market and has
become the main supplier to key rice importer Iran, owing to an energy-for-food barter system that is not subject to sanctions. With
sanctions on trade in US dollars now lifted, Pakistani exporters hope to regain a large share of the market they once dominated.
Reports in local media indicated that a trade delegation to Iran in May 2016 secured orders, but the payment mechanism remains
an outstanding issue despite positive statements from both governments about their commitment to opening banking channels.

[Link]/bmi 8

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Rice is a major export product in Pakistan, accounting for 8.4% of total goods export revenue (Pakistan’s third-most valuable export
product). Major importers of rice from Pakistan include Mainland China, Kenya, the UAE, Afghanistan and Saudi Arabia. Rice
production growth was the result of an expansion of rice harvested. Between 2015/16 and 2023/24, rice production increased at
an average pace of 3.6% per year, and the rice harvested area expanded at an average rate of 3.0% per year.

Pakistan’s rice sector is characterised by a comparatively high degree of liberalisation and private-sector involvement as well as
product differentiation. The rice sector is focused primarily on the export market, with almost 55% of total domestic rice production
exported between 2015/16 and 2023/24. During this period, non-basmati rice sales accounted for some 50% of Pakistan’s total
rice exports, with basmati rice sales accounting for around 29% and broken rice sales for a further 14%.

The USDA noted that in December 2024 that long grain rice was exporting at an average price of USD582/ metric tonne while
basmati averaged much higher at USD1,250 per tonne over November 2023 - October 2024.

Pakistan Has A Diversified Export Base

Pakistan - Rice Exports By Destination, USD'000

Note: May include territories, special administrative regions, provinces and autonomous regions. Source: Trade Map

3. Demand On Uptrend

Rice is not a staple in Pakistan and consumption remains low in comparison with most other major Asian rice growers. Predicted
price stability and population growth will be the main drivers of growth, which we now see supporting demand trends over the next
decade.

[Link]/bmi 9

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Ric
Ricee Pr
Production
oduction And Consumption (P
(Pakistan
akistan 2022-2029)
Indicator 2022 2023 2024 2025f 2026f 2027f 2028f 2029f
Ric
Ricee pr
production,
oduction, '000 tonnes 9,323.0 7,322.0 9,860.0 10,000.0 10,200.0 10,350.0 10,500.0 10,650.0
Ric
Ricee pr
production,
oduction, % yy-o-y
-o-y 10.7 -21.5 34.7 1.4 2.0 1.5 1.4 1.4
Ric
Ricee pr
production,
oduction, % of global 1.8 1.4 1.9 1.9 1.9 1.9 1.9 1.9
Ric
Ricee cconsumption,
onsumption, '000 tonnes 3,900.0 3,925.0 4,000.0 4,100.0 4,223.0 4,349.7 4,480.2 4,614.6
Ric
Ricee cconsumption,
onsumption, % yy-o-y
-o-y 5.4 0.6 1.9 2.5 3.0 3.0 3.0 3.0
Ric
Ricee cconsumption,
onsumption, % of global 0.8 0.8 0.8 0.8 0.8 0.8 0.8 0.9
Ric
Ricee cconsumption,
onsumption, kg per capita 16.5 16.3 16.3 16.4 16.6 16.8 16.9 17.1
Ric
Ricee pr
production
oduction balanc
balance,
e, '000 tonnes 5,423.0 3,397.0 5,860.0 5,900.0 5,977.0 6,000.3 6,019.8 6,035.4
Ric
Ricee self sufficiency
sufficiency,, % 239.1 186.5 246.5 243.9 241.5 237.9 234.4 230.8
f = BMI forecast. Source: USDA, FAO, BMI

[Link]/bmi 10

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Grains
Key View: The wheat harvest in 2024/25 is now estimated at 31.583mn tonnes, up 12.2% y-o-y on the back of increase in area
planted, government incentives, good irrigation and availability of healthy seed variety. At present, we expect steady output owing to
healthy plantings for the upcoming 2025/26 season. We expect both wheat and corn output, and demand to trend upwards over
the forecast period to 2028/29 due to improvements in yields, better farming techniques and organic demand growth in line with
human and livestock consumption trends. Overall, inflation will present downside demand risks over the next 12 months as cost of
living concerns continue to linger in the market.

Latest Updates

• Grains output was crippled in the 2022/23 season due to flood that damaged crops and crucial agricultural infrastructure.
However, there was a notable trend reversal in 2023/24 due to base effects and good weather.
• We estimate that Pakistan’s wheat harvest in the 2024/25 (May-April) season, which began at the start of April 2024 and was
completed in mid-June 2024 came in at 31.583mn tonnes, up 12.2% y-o-y owing to healthy yields and favorable weather in
Punjab province. In the upcoming 2025/26 season, early reports suggest that area planted is down by about 2%-3% but
irrigation authorities have suggested that water availability is expected to be 15% higher.
• Corn output in 2024/25 is estimated at 9.5mn tonnes, down modestly y-o-y due to base effects but we forecast almost 10.2mn
tonnes in 2025/26 on the back of stronger irrigation outlook.
• Grains production in Pakistan has exhibited robust growth over the past decade, benefitting from both an expansion in harvested
area and consistent improvements in crop yields.
• Wheat demand in 2025 is expected at 30.95mn tonnes, up 2.5% y-o-y as inflation cools. Wheat consumption is slated for further
growth of around 2.0% over 2025-2029 to reach 33.5mn tonnes by 2029.

Punjabi Wheat Yields To Drive Robust Crop

Pakistan - Wheat Output (mn tonnes) By Province (2024/25)

Source: USDA

[Link]/bmi 11

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Risks TTo
o Outlook
Risks
Shor
Shortt term Unreliable irrigation and water supply leave crops at the mercy of the weather. Flooding is a perennial threat to all field
crops.
If the market was able to import and distribute more fertilisers it would boost wheat production.
If Pakistan's economy was to increase above the sub-5% annual GDP growth rate seen in recent years, per capita wheat
consumption could see a small decline as consumers switch to more expensive alternatives, such as rice and meat.
This could support higher corn consumption due to livestock sector growth.
Inflation and poor headline economic outlook to weigh on food insecurity and present demand side risks over 2025 and
2026.
Long term Increasingly erratic weather patterns are likely to become a serious problem for the market. More frequent droughts in the
key agricultural states of Punjab and Sindh, as well as the likelihood of floods, present major downside risks to our
production forecast.
Population growth and silting are adding to pressure on the availability of reservoir water supplies required for irrigation.
The long-term outlook is also at risk of India withdrawing from or revise the Indus Waters Treaty to the detriment of
irrigation-fed agriculture in key agricultural regions of Pakistan.
Corn production could be boosted by the adoption of genetically-modified varieties that are high-yield and more tolerant to
drought.
There is a risk that the Ug99 virus (stem rust) may spread to wheat crops in Pakistan. The government is reported to be
releasing resistant varieties, but should they fail to do so effectively the virus could cause significant losses, as it has in East
Africa.
Food security remains a concern in some parts of the market. The key drivers of this are limited livelihood opportunities,
high food prices and recurrent natural disasters from monsoon floods, all of which have been amplified by the Covid-19
pandemic – according to the FAO.

Source: BMI

Structural Trends

1. Storage Infrastructure In Need Of Attention

The fact that even government warehouses were badly affected by floods in 2010 reinforces our view that inadequate storage
remains a major obstacle to the market's efforts to improve production. In September 2014, hundreds of thousands of tonnes of
wheat were damaged as a result of inadequate storage on farms and in local facilities. Improvements to wheat storage in
the Sindh province suggest that there is some willingness at state level to tackle the problem. The province now has the capacity to
store 10.3mn tonnes of wheat procured by the provincial government before it is supplied to flour mills. Punjab province has also
made moves to increase storage capacity through the building of grain silos with up to 100,000 tonnes of capacity added in 2016,
according to local media reports.

The scale and scope of the floods in 2022 was severe, and we are of the view that significant storage infrastructure capabilities were
reduced, especially in provinces such as Sindh where stagnant water has weighed on operations. We expect significant investments
in new storage infrastructure over the coming years, as food security is likely to once again take centre stage.

2. Improvement To Yields On The Horizon

Wheat yields in Pakistan lag behind those of neighbouring India, at around 3.3 tonnes/ha compared with 3.5 tonnes/ha. Stem rust
diseases have become an increasing problem in recent years, particularly in Sindh. Scientists at the Pakistan Agriculture Research
Council, with support from the USDA, are focusing resources on developing wheat-resistant varieties as well as varieties suited to

[Link]/bmi 12

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

the different ecological zones of Pakistan. In the short term, ensuring the availability of fertiliser would be the most straightforward
way to improve yields.

At present, supplies of imported fertiliser tend to run short in the key crop development period of October-November. The
government's decision in recent years to reduce fertiliser prices will serve to make it more affordable, but will not increase availability
on its own. At present, downside risks stem from severe fertiliser shortages and price increases since the start of the Russia-Ukraine
criss. In contrast, corn producers enjoy relatively high yields and may stand to benefit from the current government's positive
policies on genetically modified organisms.

Wheat Yield Gr
Groowth Sluggish
Area, '000 HA Production, '000 tonnes Yield, T/HA
2014/2015 9,199 25,979 2.8
2015/2016 9,204 25,086 2.7
2016/2017 9,224 25,633 2.8
2017/2018 8,973 26,674 3
2018/2019 8,797 25,076 2.9
2019/2020 8,678 24,349 2.8
2020/2021 8,805 25,248 2.9
2021/2022 9,168 27,464 3
2022/2023 8,977 26,209 2.9
2023/2024 9,033 28,161 3.1
2024/2025e 9,630 31,583 3.3

e = USDA estimate. Source: USDA, BMI

3. Government Intervention Distorts Trade

Government policy has a strong impact on Pakistan's involvement in the global wheat trade. If the support price is set at a high level
in comparison with global prices, exports will be uncompetitive. However, as the federal and regional governments hold large stocks
of wheat, they stand to lose from imports of cheaper foreign wheat.

An export subsidy is also in place to allow regional governments to clear some of their stocks, but this has had little effect as the
high support price makes Pakistani wheat unattractive to traders. Private sector investment is also discouraged by the
overwhelming influence of government intervention. According to the USDA, government procurement often reaches 25-30% of
total production, driven by both food security and market intervention objectives. In contrast, only around 15% of the harvest is
purchased by the private sector.

4. Government Support And Price Stabilisation In Wheat Production

The central importance of wheat supplies to domestic food security is reflected in the more active role of the government and
other public agencies in the sector. Pakistan’s federal and provincial governments set minimum wheat support prices and procure
wheat from farmers during the harvest period in order to stabilise local farmgate prices. Farms sell wheat either to government
agencies, which control distribution in order to manage domestic food security pressures, or direct to flour millers at mandated
prices. The USDA has noted that the high degree of public sector involvement in Pakistan’s wheat sector has served to discourage
private-sector investment in the post-harvest value chain, such as flour milling. Certified seeds are dispersed to wheat farmers
ahead of the planting season along with fertilisers, pesticides and financial credit. R&D activities also reflect food security concerns.

[Link]/bmi 13

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

In 2024/25, more than 40% of Pakistan’s wheat area was planted with a zinc-enriched wheat variant known as Akbar 2019, which
was bred by HarvestPlus, a US-headquartered biofortification firm, in collaboration with various Pakistani public sector research
institutes. In addition to its enhanced nutritional value, Akbar 2019 is described as more resistant to disease, a valuable attribute in
Pakistan due to the prevalence of wheat-rust diseases, and able to produce higher yields than current wheat strains.

Gr
Grains
ains Pr
Production
oduction And Consumption (P
(Pakistan
akistan 2022-2029)
Indicator 2022 2023e 2024e 2025f 2026f 2027f 2028f 2029f
Gr
Grains
ains mark
market
et vvalue,
alue, % of total 30.8 29.2 26.3 30.4 30.6 31.0 31.7 32.4
Wheat pr
production,
oduction, '000 tonnes 27,464.0 26,400.0 28,176.0 31,400.0 31,600.0 31,250.0 31,950.0 32,650.0
Wheat pr
production,
oduction, % yy-o-y
-o-y 8.8 -3.9 6.7 11.4 0.6 -1.1 2.2 2.2
Wheat pr
production,
oduction, % of global 3.5 3.3 3.6 3.9 3.9 3.9 3.9 4.0
Wheat cconsumption,
onsumption, '000 tonnes 27,700.0 29,000.0 30,200.0 30,955.0 31,574.1 32,205.6 32,849.7 33,506.7
Wheat cconsumption,
onsumption, % yy-o-y
-o-y 5.3 4.7 4.1 2.5 2.0 2.0 2.0 2.0
Wheat cconsumption,
onsumption, % of global 3.5 3.7 3.8 3.9 3.9 4.0 4.0 4.1
Wheat pr
production
oduction balanc
balance,
e, '000 tonnes -236.0 -2,600.0 -2,024.0 445.0 25.9 -955.6 -899.7 -856.7
Wheat self sufficiency
sufficiency,, % 99.1 91.0 93.3 101.4 100.1 97.0 97.3 97.4
Corn pr
production,
oduction, '000 tonnes 9,525.0 10,985.0 9,847.0 9,500.0 10,200.0 10,350.0 10,500.0 10,650.0
Corn pr
production,
oduction, % yy-o-y
-o-y 6.5 15.3 -10.4 -3.5 7.4 1.5 1.4 1.4
Corn pr
production,
oduction, % of global 0.8 0.9 0.8 0.8 0.8 0.8 0.8 0.8
Corn cconsumption,
onsumption, '000 tonnes 8,800.0 9,500.0 9,310.0 9,216.9 9,677.7 10,161.6 10,669.7 11,203.2
Corn cconsumption,
onsumption, % yy-o-y
-o-y 0.0 8.0 -2.0 -1.0 5.0 5.0 5.0 5.0
Corn cconsumption,
onsumption, % of global 0.7 0.8 0.8 0.8 0.8 0.8 0.8 0.9
Corn pr
production
oduction balanc
balance,
e, '000 tonnes 725.0 1,485.0 537.0 283.1 522.3 188.4 -169.7 -553.2
Corn self sufficiency
sufficiency,, % 108.2 115.6 105.8 103.1 105.4 101.9 98.4 95.1
e/f = BMI estimate/forecast. Source: FAO, USDA, BMI

[Link]/bmi 14

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Cotton
Key View: The short-term outlook for the 2024/25 Pakistani cotton crop is very poor due to pest concerns and economic
challenges facing the market. Most recent reports indicate that the 2024/25 cotton crop has been hit hard by drought during June -
August 2024, whitefly attacks and pink bollworm. As such, we see cotton output contracting by a sharp 28.6% to 5.0mn 480lb bale,
down from 7.0mn 480lb bales in 2023/24. The government will continue to invest into reviving cotton production to meet the
demand of the textile sector but output will remain below peak as farmers invest into more profitable crops. We also note that
demand for cotton from the local textile sector will continue to surge and encourage imports as the apparel industry and garments
manufacturers look to source their raw materials from abroad while facing elevated energy costs and limits on foreign exchange.

Latest Updates

• We forecast output of around 5.0mn 480lb bales in 2024/25, down 28.6% y-o-y from the 7.0mn 480lb bales in 2023/24. This
comes as ballworm, whitefly attacks and drought have all crippled yields.
• In February 2025, local news reported that the local producers were facing multiple challenges due to record-high, tax free
cotton ad yarn imports. Between July 2024 and January 2025, Pakistan is estimated to have imported 1.5mn 480lb bales of
cotton and 1.25mn 480lb bales of yarn at a time when the local sector faces acute challenges. The surge in imports has resulted
in a number of bankruptcies among spinning mills and ginning factories with concerned about the sustainability of domestic
production being raised repeatedly in Q1 2025.
• The domestic cotton and garments industry will look to source cotton from overseas suppliers as they face reduced crop at
home, high energy and fuel costs and challenges in the foreign exchange market. That being said, we do expect demand to
remain broadly supported over 2025-2029 as it is tied to the fortunes of the relatively strong textile sector that is competitive in a
global context.
• In May 2024, AGI Denim launched a new regenerative cotton project in Pakistan's Sindh province. It is estimated that the
initiative will help over 1,300 cotton farmers in the province.
• In H2 2023, the Premium Organic Cotton Project, a collaboration between Premium Textile Mills and WWF Pakistan commenced
in the Pacca Chang region of the country. The project is set to involve over 1,000 organic farmers over the next five years.
• In December 2023, Amsterdam-based Organic Cotton Accelerator (OCA), launched a new organic cotton training programme
curriculum for Pakistani farmers. The web-based training programme is hoping to train organic cotton farmers in global best
practices in English and Urdu. OCA has recorded considerable success in the region with its best-practice programmes.
• The federal and state governments had been working over the 2021-2023 period to encourage cotton recovery in the market,
through measures such as approving 19 new seed varieties. We expect strong incentives over 2025/26 season but note that
pests and drought will remain concerns.
• Cotton imports have spiked in recent years to make up the demand shortfall. Across the remainder of our forecast period, we
see sideways growth unless major efforts are put into place.
• Major global fashion retailer Primark announced in 2019 that it would expand its cotton farmer training programme in Mainland
China, India and Pakistan. The move is part of the firm's global Sustainable Cotton Programme expansion.
• Whitefly attacks will present downside output risk in the 2025/26 season in the Punjab region but favorable weather has so far
been reported.

[Link]/bmi 15

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Risks TTo
o Outlook
Risks
Shor
Shortt term Unreliable irrigation and water supply leave crops at the mercy of the weather. Cotton is a particularly water-intensive crop,
making it vulnerable to drought, while wet weather prior to harvest can damage the lint.
Given that the EU is a major buyer of Pakistani textile products, continued slow growth or even a relapse into recession would
seriously depress demand, especially given that Pakistani ginners import high-quality cotton with a view to exporting their
products outside of the market.
Cotton is highly vulnerable to outbreaks of disease (eg, leaf curl virus) and insect infestations (eg, whitefly, bollworms).
Pakistani farmers often lack the inputs and expertise to combat these threats effectively and in times of depressed cotton
prices may attempt to economise by avoiding spraying crops, thereby increasing the risk of disease.
Whitefly attacks and weather severity could weigh on crop yields and output in 2025/26 as was the case in 2024/25.
Long term Increasingly erratic weather patterns are likely to become a serious problem for Pakistan. More frequent droughts in the key
agricultural states of Punjab and Sindh, and a high likelihood of future flooding, present major downside risks to our
production forecast. Global warming could also reduce water supply from glacial melting.
Government approval of the latest genetically modified cotton plants would present upside risk to our forecasts, given the
willingness of farmers to use new seed varieties.
Pakistan's relationship with India poses risks to cotton production and consumption. Any deterioration in relations could lead
to India withdrawing its unilateral award of Most Favoured Nation (MFN) status to Pakistan, increasing tariffs on imported
cotton and textile goods. Conversely, closer ties between the two countries could see Pakistan afford the MFN status to India,
reducing tariffs and other barriers on hundreds of products and, in turn, potentially allowing Indian cotton and textiles to be
imported into Pakistan in far higher quantities. The conclusion of such a deal would pose both upside risks to cotton demand
and downside risks for supply. We also note that any attempt on India's part to withdraw from or modify the terms of the
Indus Waters Treaty would threaten the viability of irrigation-fed agriculture in large parts of Pakistan.

Source: BMI

Structural Trends

1. Textile Fortunes Tied To Energy Sector

Although Pakistan's cotton ginning and textile industry is relatively efficient, its performance has long been hampered by the
market's unreliable and expensive power supply. Power blackouts and load shedding are routine, forcing the industry to shut down
operations or rely on expensive private energy generation. A Wilson Center report into the crisis of 2015 found that it may have
been responsible for losses of up to 4% of Pakistan's GDP, citing concerns over energy generation as a major disincentive to foreign
investors. However, we are now more optimistic about the capacity of the energy sector to overcome these weaknesses as the
government attempts to increase investment in gas and electricity infrastructure. Even partially successful reforms could be
transformative for many energy-intensive industries, including textile and cotton processing.

[Link]/bmi 16

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Lacklustre Outlook In Pakistan, But Country To Remain Among Biggest Producers

Select Markets - Cotton Production, '000 480lb. bales

f = BMI forecast. Source: ABARES, USDA, BMI

2. Favourable Terms From The EU

The EU's decision in late 2013 to allow duty-free or preferential access for around 3,500 products, including textiles, has supported a
substantial increase in Pakistani cotton demand. EU approval of the Generalised Scheme of Preferences (GSP) Plus status to
Pakistan became effective on January 1 2014, allowing 20% of the market's exports to be imported into the EU with no tariff
payable. A further 70% is allowed at preferential rates. Pakistan joins other major textile producers in the developing world, such as
Sri Lanka and Bangladesh, in attaining this status and will, therefore, still face stiff competition for the EU's lucrative textile market.
However, GSP Plus status could allow the value of textile exports to double to USD1.0bn, according to the USDA. We expect to see
relatively elevated demand for cotton imports over our forecast period to 2027/28.

3. Biotech Growing In Importance

Pakistani growers are embracing genetically modified cotton in a bid to make their crops more resilient to disease and bad weather.
The USDA estimates that for the 2022/23 season, over 30 varieties of genetically engineered cotton were used to plane 2.2mn
ha. This accounts for around 95% of the total cotton planted area in Pakistan. Regulatory issues have held up authorisation of new
varieties of Bt cotton seed, with responsibility for many agricultural issues a subject of constitutional debate between federal and
state governments. Local reports suggest that, in January 2021, authorities approved 15 new cotton varieties, 14 of which are bio
engineered.

[Link]/bmi 17

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Local Demand Rising

Pakistan - Cotton Production, consumption & balance

e/f = BMI estimate/forecast. Source: USDA, local sources, BMI

4. Man-Made Fibres On The March

The collapse in world oil prices has exacerbated an underlying trend towards the consumption of synthetic fibres at the expense of
natural materials. We hold the view that the growing popularity of synthetic fibres will curtail cotton consumption over the next five
years, which will combine with elevated inventories on the supply side and have a lasting impact on cotton prices. While the
Pakistani textile sector could be expected to adapt to meet the demand for synthetic and blended textile products, the impact will
be felt more strongly further down the value chain as cotton ginners and growers see reduced demand for their output.

5. Imports On An Uptrend

Pakistan is an important importer and exporter of cotton and will remain so in the years to come. No tariffs or restrictions are placed
on the import and export of cotton by the government. In the short term, imports are expected to rise rapidly on the back of a sharp
drop in output. Recovering demand for textiles in the crucial eurozone and US markets will require Pakistani mills to import more
high-quality cotton than is available domestically. Pakistani cotton exports will also increase once domestic production recovers, as
there is demand for cotton from emerging markets' textile producers, with Indian importers expected to be the major beneficiaries.

[Link]/bmi 18

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Cotton Pr
Production
oduction And Consumption (P
(Pakistan
akistan 2022-2029)
Indicator 2022 2023 2024e 2025f 2026f 2027f 2028f 2029f
Cotton pr
production
oduction '000 480 lb. Bales 6,000.0 3,900.0 7,000.0 5,500.0 6,500.0 6,650.0 6,725.0 7,050.0
Cotton pr
production
oduction '000 480 lb. Bales, % yy-o-y
-o-y 33.3 -35.0 79.5 -21.4 18.2 2.3 1.1 4.8
Cotton pr
production,
oduction, % of global 5.2 3.3 6.2 4.7 5.5 5.6 5.5 5.7
Cotton cconsumption
onsumption '000 480 lb. Bales 10,700.0 8,700.0 9,700.5 9,913.9 10,161.8 10,415.8 10,676.2 10,943.1
Cotton cconsumption
onsumption '000 480 lb. Bales, % yy-o-y
-o-y -1.8 -18.7 11.5 2.2 2.5 2.5 2.5 2.5
Cotton cconsumption,
onsumption, % of global 9.2 7.8 8.5 8.6 8.7 8.8 8.9 8.9
Cotton cconsumption,
onsumption, kg per capita 5.5 3.5 6.2 4.8 5.6 5.6 5.5 5.7
Cotton pr
production
oduction balanc
balance,
e, '000 480lb. Bales -4,700.0 -4,800.0 -2,700.5 -4,413.9 -3,661.8 -3,765.8 -3,951.2 -3,893.1
Cotton self sufficiency
sufficiency,, % 56.1 44.8 72.2 55.5 64.0 63.8 63.0 64.4
e/f = BMI estimate/forecast. Source: USDA, local sources, BMI

[Link]/bmi 19

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Commodities Price Analysis

Monthly Commodities Strategy: Solid Gains Overall In February, Barring Some
Weakness In Oil And Grains
Commodity sub-asset classes showed significant price strength in 2025 thus far, with the Bloomberg Commodity
Index gaining 4.9% in the year-to-date as of February 27. While price strength in general has largely been driven by the
weakening of the US dollar from a high of 110 for the DXY on January 13 to 106 at the time of writing on February 27, idiosyncratic
factors have also worked to boost individual sub-asset classes. Agricultural softs have outperformed the wider complex in February,
driven by supply-side concerns boosting sugar and coffee. Industrial metals follow close behind, with optimism surrounding
Mainland Chinese stimulus and concerns of supply disruptions amid trade tensions. Within precious metals, gold refuses to lose its
shine, climbing to fresh record highs as safe haven demand from investors and central banks continue to boost the asset. Within
energy, US Henry Hub gas prices have seen a bullish run in February over strong demand and below-average natural gas storage
levels, but Brent crude oil prices continue to suffer from negative sentiment as the market remains biased towards the downside.
Finally, agricultural grains have underperformed all sub-asset classes in February, as news of strong harvests weighed on price
performance.

Commodity Prices Remain Well Above January 2024 Levels

Select Bloomberg Commodity Indices - Normalised As Of January 2024 (LHC) & January 2025 (RHC)

Note: For LHC, January 2 2024 = 100 and for RHC, January 2 2025 = 100. Source: Bloomberg, BMI

Oil And Gas:

Conflicting US Policies Muddying The Outlook For Oil

Brent crude oil prices have come under sustained downward pressure since US President Donald Trump returned to office on
January 20. The front-month contract has fallen from its year-to-date high of USD82/bbl at the January 15 close, to below USD73/
bbl at the time of writing on February 26. Market participants are struggling to gauge the impact of the flood of energy-related
policy announcements made by the Trump administration this month. However, those weighing to the downside, notably US tariff
measures, are currently winning out. Our economists are anticipating limited economic fallout from the expected rise in tariff rates,
with around 0.3% shaved off global GDP over 2025 and 2026. As such, any related oil demand destruction should be limited.
However, prices can still be impacted via sentiment channels. Meanwhile, peace talks over the Russia-Ukraine war and the
announcement of the restart of oil exports from the Kurdish region of Iraq have brought additional pressure to bear, offsetting
supply-side disruptions in Kazakhstan and signs of strain on Iranian and Russian exports.

[Link]/bmi 20

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Macro Conditions Key To Brent

Global - US Dollar Index & Brent Crude, USD/bbl

Source: Haver, BMI

The risks to the outlook are considerable. On the downside, we have the potential for higher-than-expected tariffs that, at an
extreme, could threaten recession; potential sanctions relief on Russian oil; and Trump’s push to deregulate the US energy sector
and boost domestic oil output. On the upside, we have the return of the maximum pressure campaign against Iran, which includes a
commitment to drive its oil exports down to zero; scope for renewed cutbacks by OPEC+; energy tariffs, generating trade frictions; a
pledge to restock US strategic oil reserves; the rollback of subsidies and other support measures for renewables consumption in the
US, favouring fossil fuel demand; and climate policy backsliding, bolstering sentiment towards oil. Additionally, we see upside risk to
our current forecast for the dollar (which has been positively correlated to oil for most of the past five years), should renewed
inflationary pressures force a more hawkish approach to interest rates by the US Federal Reserve. How annual average prices
balance out will largely depend on how Trump prioritises his wide-ranging (and often conflicting) policy objectives and we should
have greater clarity on this over the coming months. However, price action in the year-to-date has been broadly in line with our
expectations and we are holding to our current forecast for Brent crude to average USD76/bbl this year.

[Link]/bmi 21

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Russian Oil Flows Dipping Down

Russia - Seaborne Crude Oil Exports, ‘000b/d

Source: Bloomberg, BMI

Tariff Risks Loom Over US Gas Prices

In line with our expectations, US Henry Hub gas prices have seen a bullish run since the start of the year, increasing 15.7% since
January 1 2025 to stand at USD4.2/mnbtu on February 21. Below-average natural gas storage levels have put a floor beneath prices
alongside high demand from the US LNG sector. Prices are set for a substantial increase over 2025 to average USD3.4mnbtu in
2025, up from USD2.4mnbtu in 2024. Over H225, we see Henry Hub prices averaging around USD3.5/mnbtu on the back of strong
net LNG exports and improving domestic demand. However, we highlight elevated risks to our Henry Hub price view, stemming
from the impact of tariffs on some of the US key trade partners. Whether they are put into effect or delayed, the potential for supply
disruption or a broader macroeconomic impact of a trade war could temper gas demand globally and push down global gas prices.
In Europe, prices have since cooled from their peaks seen in January 2025, with the benchmark Dutch TTF Front Month contract
closing at EUR44.2/MWh on February 25, down 16.8% since the start of February. The potential for a ceasefire between Russia and
Ukraine, as well as milder temperatures, have eased pressures on supply and demand, though upside pressure will nonetheless
remain from low storage (currently at 40.3% as of February 24). Shouldering season over Q2-Q3 2025 will see prices buoyed as
European inventories must fill approximately 50bcm of gas by November 2025 in preparation for the 2025/26 winter.

[Link]/bmi 22

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

European Gas Prices Fall From Peak While Henry Hub Sees Bullish February Run
LHC: Dutch TTF (EUR/MWh); RHC: US Henry Hub Prices (USD/mmbtu)

Source: BMI, Bloomberg

Agicultural Commodities:

Sugar And Coffee Futures Outperform Other Softs Driven By Supply-Side Issues, Concerns About Demand Weigh On
Cocoa And Cotton

Over the past month, half of the soft commodities we monitor, namely sugar, coffee and palm oil, have posted gains, while the other
half, cocoa, milk and cotton, have posted losses. Focusing first on the commodities that have experienced an upward pressure on
prices, we flag sugar and coffee as the outperformers, with closing prices on February 25, 2025 equivalent to 12.8% m-o-m and a
9.6% m-o-m increases, respectively. For both, concerns about harvests in large producing markets have been the main driver of
bullish sentiment. For instance, we flag news of sugar mills in India halting operations ahead of their normal schedules due to lower
cane supplies and broader concerns about increased diversion of sugar to ethanol production. In Brazil, below-average soil moisture
in sugar-producing regions also presents a downside risk for sugar production in the country. Weather condition in these areas over
the next few weeks and months leading up to the start of the harvest in April will be a crucial factor determining Brazilian output and
consequently prices given that Brazil accounted for 56.8% of global sugar exports in 2023/24. Similarly, concerns about production
of coffee in Brazil have been the main driver of elevated prices. We also flag the threat of US tariffs on Colombia as a factor creating
further uncertainty in the market.

[Link]/bmi 23

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Demand-Side Concerns For Cocoa Place Downward Pressure On Prices Despite Continued Production
Issues
Ivory Coast - Cocoa Arrivals At Ports, mn tonnes And 2025 Arrivals Versus 2024 And 2023 Arrivals, %

Source: Bloomberg, BMI

Of the commodities that have posted month-on-month decreases, cocoa experienced the largest decline, closing the February 25,
2025 session at USD8,805/tonne. This is 22.8% lower than a month prior and the USD8,482/tonne recorded on February 24, 2025
is the lowest price since November. Concerns about supply in West Africa remain. While cocoa arrivals at Ivory Coast ports 34.6%
higher as of December 1, 2024 compared to a year prior, the difference between the 2024/25 season and the 2023/24 season is
narrowing. Arrivals as of February 23, 2025 were up 17.2% y-o-y. Similarly, the gap between 2024/25 arrivals and 2022/23 arrivals is
growing. As of December 1, 2024, they were 11.1% lower than two years prior, while they were 20.0% lower as of February 23, 2025.
Despite this, cocoa futures have experienced downward movements, largely driven by concerns about demand. Data on cocoa
grindings from 2024 released in mid-January 2025 indicates a 0.3% y-o-y decline in global grindings. Statements from Hershey and
Mondelez at the start of February also contributed to concerns that demand is easing in the faces of elevated prices. Executives
from both companies noted the risk of a potential slowdown in chocolate demand, resulting in them adopting strategies to
reformulate recipes to include less cocoa. Finally, expectations for abundant production of cotton in Brazil and Australia coupled
with concerns about low demand from Mainland China and risks associated with US tariffs have weighed on prices of the
commodity, which closed the February 25, 2025 season 28.9% lower than a year prior.

Expectations For Abundant Rice And Soybean Harvests Weigh On Prices – Tariff-Related Risks Remain

Of the four grains futures we monitor (rice, corn, wheat and soybean), only wheat posted a month-on-month increase as of February
25, 2025, with prices 5.2% higher than a year prior. According to our forecasts, carry-over stocks in key exporters of wheat will
decrease in 2024/25 - a tightening of the market which we expect will make it more sensitive to events affecting wheat harvests.
We expect production in the EU and Russia to decrease in 2024/25 by 8.1% y-o-y and 10.9% y-o-y, respectively, but upward price
pressure from this has been largely mitigated by expectations for increased production in the US. We forecast domestic production
in the US in 2024/25 to increase by 8.5% y-o-y. With crops currently in a state of dormancy, conditions in the spring months will be
the most relevant in determining harvest outcomes. Overall, we believe that the tightening of global stocks will make prices more
vulnerable to upwards momentum. That said, we note that market participants continue to hold a net short position, with the last
net long position recorded in June of 2022. Yet, this market positioning creates susceptibility to short-term upward movements due
to short covering, posing risks to prices.

[Link]/bmi 24

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Limited Import Dependence Minimises Tariff Impact, but Export Role Leaves Sector Vulnerable to
Retaliation
US - Combined Trade Balance With Mainland China, Canada, And Mexico, '000 USD

Source: Trademap, BMI

We highlight a continued downward movement in rice prices, with futures closing the February 25, 2025 session 6.8% lower than a
month prior and 26.0% lower than a year prior. Soybean futures also posted monthly and yearly decreases, albeit smaller than those
for rice: -1.8% m-o-m and -8.4% y-o-y. With rice, we highlight expectations for abundant harvests in India and the easing of export
restrictions there as the main driver of bearish sentiment. We expect production to rebound in 2024/25, increasing by 5.21% y-o-y,
up to 145mn tonnes. The USDA also expects exports to increase significantly, up to 22mn tonnes from the 14.4mn tonnes in 2023/
24. We note that the mild La Niña event is also expected to benefit rice production in Southeast Asia more broadly. In line with this,
beginning stocks in 2025/26 are set to increase by 4.8% y-o-y in India, 14.8% y-o-y in Pakistan, and 17.7% y-o-y in Thailand.
Beginning stocks will also increase globally, by 1.2% y-o-y. We believe that all these factors in combination will cap prices in 2025
and will persist in 2026. While tariffs are a concern for grain prices, we note that the US’ limited import dependence minimises their
potential impact, while its role as exporter makes the domestic sector vulnerable to retaliation.

Metals:

US Tariffs In The Limelight For Industrial Metals

Industrial metal prices posted modest gains in February thus far, bolstered by a slightly weaker US dollar, while the
slew of Trump’s tariff threats kept markets on edge throughout the month, with the Bloomberg Industrial Metals sub-
index increasing by 0.8% m-o-m, as of February 25. Looking ahead to the rest of 2025, we maintain the view that although short-
term upward pressures on metal prices are likely in response to Trump-led trade policy shifts, the longer-term outlook remains
bearish, as tariffs are expected to weigh on the market, pushing up the US dollar and posing headwinds to metals, given their inverse
relationship with the greenback.
Looking closer at individual metals performance, copper led the base metals higher, rising by 1.4% m-o-m to USD9,402/tonne as of
February 25. Supported by a softer US dollar, copper prices received an additional short-term boost due to growing speculations
that copper tariffs might be Trump’s next move. Indeed, on February 25, Trump ordered a new tariff investigation into US copper
imports, which resulted in the price spread between COMEX and LME widening back again to USD900/tonne, following a surge to
over USD1,200/tonne on February 14. Aluminium also remained in the spotlight, with prices declining slightly by 0.1% m-o-m to
USD2,639/tonne, as of February 25, after surging to USD2,727/tonne on February 20 following reports that the EU agreed on a ban

[Link]/bmi 25

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

on primary aluminium imports from Russia. New 25% tariffs on aluminium imports announced on February 10 also saw the US
Midwest premium surge in response. Turning to ferrous metals, iron ore (62% Fe content) prices at Qingdao Port are currently
hovering around USD100.2/tonne, rising by 0.5% m-o-m, as of February 25, with supply disruptions in Australia and Mainland
Chinese demand optimism sending prices to a four-month high on February 21, counterbalancing fresh trade tariffs earlier in the
month.

Robust Start To The Year, Yet Trade War Risks Linger

Select Industrial Metal Prices, USD/tonne (2024-2025)

Source: Bloomberg, BMI

Precious Metals Continue To Shine

As for precious metals, gold prices touched another record high of USD2,956/oz on February 24, rising 11% year-to-date as of
February 25, driven by lower bond yields, stronger central bank purchases of physical gold, and a weaker US dollar that provided
additional tailwinds. We continue to hold a bullish outlook towards gold prices, and believe gold could reach USD3,200/oz in the
coming weeks as the safe haven asset is boosted by a number of factors.

Gold has benefited from economic and geopolitical risks since 2020, with prices witnessing a pronounced rally since the start of the
war in Gaza in October 2023, amplified in 2024 by the weakening of the US dollar and the start of the US Fed’s rate cutting cycle. In
2025, we expect the US Fed to adopt a more cautious approach to interest rate cuts, especially as Trump’s tariffs will raise US
inflation and influence Fed policy that would likely depend on whether inflation or a growth shock dominates. In this regard, the
impact of interest rate cuts, which we still expect at a total of 50basis points in 2025, will be more nuanced on gold prices than in
2024. Yet, this remains a bullish factor for gold, until the market starts to believe the Fed would not cut this year.

Interest rates aside, gold is and will continue to benefit from US policy uncertainty, trade tensions, military conflict around the world,
inflation worries and macro uncertainty that have in turn catapulted investor and central bank purchases of gold to mitigate and
hedge against instability throughout 2024 and into 2025. We see US dollar strength (our Macro team believes there are upside risks
to our current forecast of 100-108 for the DXY in 2025) as the only bearish factor for gold in 2025, but believe that the rest of the
factors will outweigh the impact of dollar strength, and gold will once again be an outperformer within the wider metals complex, a
scenario that would be put into limbo only if the US Fed proceeds to raise interest rates instead.

[Link]/bmi 26

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Gold Climbs Higher As A Weaker Dollar And Trump Tariff Uncertainties Fuel Support
Gold Prices, Bond Yields & US Dollar Index (2024-2025)

Source: Bloomberg, BMI

Commodities SStr
trategy
ategy And Outlooks
Commodity Three- 12-To-24 Month Outlook Comment Recent
Sub-Group To-Six Analysis
Month
Outlook
Oil Neutral- Neutral-bullish After rallying into the new year, crude oil prices have sold off 'Brent: Prices
bullish sharply during US President Donald Trump’s first few weeks in Under
office. We can expect significant volatility in pricing over the Pressure As
coming weeks and months as markets scramble to weigh the Trump Tariffs
impact of Trump’s new policy positions, not least regarding tariff Loom Large',
measures. While some tariff measures could put upward pressure February 5
on oil prices, the net impact will likely be bearish, given their 2025
potentially adverse effects on the global economy and Trump’s
proven willingness to offer carve-outs for energy (to limit impacts
to supply). Investors will have to balance the price impact of tariffs
against the implications of a more hawkish approach to sanctions
enforcement, with Trump recently signing a memorandum
restoring his maximum pressure campaign against Iran. We hold to
our view for Brent crude to average USD76/bbl in 2025, down
from USD80/bbl in 2024, while acknowledging wide-ranging risks
to the outlook, both to the upside and the down.
Natural gas Bearish- Bearish-bullish US Henry Hub gas prices are expected to strengthen in 2025
bullish compared to 2024. We expect 41% y-o-y growth in average prices Dutch TTF and
to USD3.4mnbtu in 2025, from USD2.4mnbtu in 2024. This growth UK NBP Prices:
will be primarily driven by growing demand for natural gas from the Storage
US liquefied natural gas sector. In Europe, prices have rallied since Pressures Add
the start of Q1 2025 owing to supply concerns alongside the Upside Risk To
termination of the Russia-Ukraine gas transit deal. Strong demand 2025 Gas
further compounded supply concerns as temperatures veered

[Link]/bmi 27

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Commodity Three- 12-To-24 Month Outlook Comment Recent

Sub-Group To-Six Analysis
Month
Outlook
below typical winter averages across December to February,
leading to higher-than-expected storage drawdowns, with TTF spot Prices', January
prices standing at EUR44.3/MWh on February 25. We look to revise 8 2025
up our expectations for European gas prices for 2025 as a result,
given the likely upwards pressure on prices later in the year as 'Henry Hub:
storage builds back up. We note some downside risk to prices from Growing
the potential ceasefire between Russia and Ukraine, and limited Downside
restart of gas flows into Europe Risks For 2025
Prices'
February 7
2025

'Limited UK
Gas Storage
Faces
Consequences
Amid LNG
Competition'
Feb 7 2025

Ferrous Neutral- Neutral Iron ore (62% Fe content) prices at Qingdao Port are currently
metals bearish hovering around USD100.2/tonne, rising by 0.5% m-o-m, as of 'Iron Ore: Price
February 25, with supply disruptions in Australia and Mainland Weakness To
Chinese demand optimism sending prices to a four-month high on Continue Into
February 21, counterbalancing fresh trade tariffs earlier in the 2025, Upside
month. Contingent On
Mainland
Chinese
Stimulus',
November 15
2024

'Steel Prices: In
A Tug Of War
Between
Trump's Trade
Policy Shifts
And Mainland
Chinese
Demand',
December 3
2024

Base metals Bearish Neutral-bearish Copper led base metals higher, rising by 1.4% m-o-m to
USD9,402/tonne, as of February 25. Supported by a softer US 'Aluminium:
dollar, copper prices received an additional short-term boost due Prices Climb
to growing speculation that copper tariffs might be Trump’s next On Stronger
move. Aluminium also remained in the spotlight, with prices
declining slightly by 0.1% m-o-m to USD2,639/tonne, as of

[Link]/bmi 28

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Commodity Three- 12-To-24 Month Outlook Comment Recent

Sub-Group To-Six Analysis
Month
Outlook
February 25, after surging to USD2,727/tonne on February 20
following reports that the EU agreed on a ban on primary Market
aluminium imports from Russia. New 25% tariffs on aluminium Fundamentals',
imports announced on February 10 also saw the US Midwest November 1
premium surge in response. Looking ahead to 2025, we maintain 2024
the view that although short-term upward pressures on metal
prices are possible in response to Trump-led trade policy shifts, the 'Copper:
longer-term outlook remains bearish, as tariffs are expected to Trump's
weigh on the market, pushing up the US dollar and posing Victory To
headwinds to metals, given their inverse relationship with the Weigh On
greenback. Prices In 2025',
December 27
2024

Precious Bullish Neutral Gold prices touched another record high of USD2,956/oz on 'Gold Prices:
metals February 24, rising 11% year-to-date as of February 25, driven by Trump Victory
lower bond yields, stronger central bank purchases of physical Brings End To
gold, and a weaker US dollar that provided additional tailwinds. We Gold’s Rally',
continue to hold a bullish outlook towards gold prices, and believe November 15
gold could reach USD3,200/oz in the coming weeks as the safe 2024
haven asset is boosted by a number of factors.
Grains Neutral Neutral Over the past week (February 18 – February 25), second-month
CBOT-listed corn and wheat futures declined by 4.9% and 4.1% 'Soybean 2025
week-on-week, respectively, due to a modest improvement in the Price Outlook:
supply outlook. For corn, we anticipate further price pressure in the Downward
coming months as Brazilian exports from the first corn crop begin, Revision As
easing temporary market tightness. In Argentina, recent rains have Mainland
mitigated some concerns about additional drought-related losses, China's Import
although continued rainfall on drought-affected soil poses a risk Demand Falls
that we are closely monitoring. Looking ahead to the US 2025/26 Further Than
season, there is an expectation of increased corn plantings over Expected',
soybeans, driven by an anticipated rise in returns. However, rising January 07
fertiliser prices could potentially impact this preference. 2025
Meanwhile, second-month CBOT-listed soybean prices remained
relatively stable week-on-week as the market balances reduced 'Wheat Price
output expectations in key regions against an uncertain demand Outlook:
outlook. We expect weak import demand from Mainland China to Robust US
be a predominant bearish factor throughout 2025. Production
Pressures
Prices,
Anticipated
Tightening in
2025/26 To
Bolster Prices
In H2 2025',
January 09
2025

[Link]/bmi 29

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Commodity Three- 12-To-24 Month Outlook Comment Recent

Sub-Group To-Six Analysis
Month
Outlook

Softs Neutral Neutral-bullish In the week up to February 25, 2025, cocoa futures posted a large
decrease of 16.1%, largely due to concerns that demand is easing Cocoa Price
in response to elevated prices throughout 2024 and into the start Forecast:
of 2025. Coffee also posted a decrease in the same time period Further
due to increasing stocks and easing concerns over Trump tariffs on Upward
Colombia. Milk and cotton futures also posted decreases, of 2.9% Revision As
and 2.1%, respectively, in line with forecasts for abundant Production-
production and muted demand. Sugar prices posted a 4.6% w-o-w Related
increase with bullish sentiment catalysed by concerns about Concerns
production in Brazil. On a month-on-month basis, cocoa posted Remain,
the largest decrease, of 22.8%, while sugar posted the largest January 22
increase, of 12.8%.
Coffee Price
Forecast:
Bullish
Sentiment
Persists
Amidst Supply-
Side Concerns,
January 10

Milk Forecast:
Improved
Outlook For US
Milk
Production
Placing
Downward
Pressure On
Prices,
December 15

Note: Outlook from current prices as of February 27 2025. Source: BMI

[Link]/bmi 30

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Select Commodities - P
Perf
erformanc
ormancee And BMI FFor
orecasts
ecasts
2025f (%
Current 1 Year 2024 YTD 2025f 2026f
Commodity Unit YTD (% chg) chg y-o-
Price (% chg) (ave) (ave) (ave) (ave)
y)
Agriculture
Class III Milk USD/cwt 18.62 -8.64 6.04 19.05 19.56 18.00 17.00 -5.5
GBP/
Cocoa (London) 7,451 -14.47 34.06 5,915 8,393 5,758 5,333 -2.7
tonne
Coffee USc/lb 375.20 19.17 108.91 232.60 359.85 240.00 230.00 3.2
USc/
Corn 494.50 6.17 16.77 435.00 492.69 450.00 450.00 3.4
bushel
Cotton USc/lb 67.01 -3.57 -32.18 77.50 68.22 72.20 75.00 -6.8
Feeder USc/lb 274.38 4.32 8.43 - 271.22 - - -
Lean Hogs USc/lb 88.30 8.61 2.35 - 84.66 - - -
Live Cattle USc/lb 198.83 2.57 7.05 - 199.44 - - -
MYR/
Palm Oil 4,495 1.06 14.61 4,050 4,409 3,900 3,950 -3.7
tonne
Rough Rice USD/cwt 13.62 -3.44 -25.82 16.35 14.19 14.20 14.60 -13.1
USc/
Soybean 1,046 3.49 -8.33 1,120 1,048 1,020 1,080 -8.9
bushel
Sugar #11 USc/lb 20.80 8.00 -12.75 20.90 19.55 20.70 20.40 -1.0
USc/
Wheat 577.25 2.62 -1.20 588.60 574.24 580.00 605.00 -1.5
bushel
Energy
USD/
Coal, Thermal (Newcastle) 102.40 -18.24 -19.84 135.70 111.97 120.00 100.00 -11.6
tonne
USD/
Coal, Coking 186.33 -7.76 -37.68 244.11 195.62 200.00 180.00 -18.1
tonne
Brent Crude USD/bbl 72.91 -2.32 -12.84 79.86 76.74 76.00 75.00 -4.8
OPEC Basket, Oil USD/bbl 74.87 0.38 -7.37 79.87 78.22 75.00 74.00 -6.1
WTI Crude USD/bbl 69.02 -3.76 -12.49 75.76 73.27 73.00 72.00 -3.6
USD/
Natural Gas (HH) 3.97 9.25 145.76 2.41 3.73 3.40 3.80 41.2
mnBtu
USD/
Natural Gas (NBP) 13.12 -12.72 70.01 10.80 15.12 10.88 10.80 0.7
mnBtu
EUR/
Natural Gas (TTF) 43.30 -11.03 80.15 34.57 49.38 32.00 30.00 -7.4
MWh
Industrial Minerals & Metals
USD/
Aluminium 2,633 3.17 20.76 2,458 2,613 2,500 2,600 1.7
tonne
USD/
Cobalt 22,880 -5.84 -19.86 - 22,861 - - -
tonne
Copper USD/ 9,460 7.89 11.74 9,266 9,227 10,000 11,500 7.9

[Link]/bmi 31

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

2025f (%
Current 1 Year 2024 YTD 2025f 2026f
Commodity Unit YTD (% chg) chg y-o-
Price (% chg) (ave) (ave) (ave) (ave)
y)
tonne
USD/
Iron Ore (62% CFR, Qingdao) 100.21 5.10 -14.92 103.70 98.14 100.00 95.00 -3.6
tonne
USD/
Lead 2,011 3.00 -4.12 2,103 1,969 2,100 2,250 -0.1
tonne
USD/
China Lithium Carbonate 10,248 -1.32 -22.80 12,521 12,255 20,000 25,000 59.7
tonne
USD/
Nickel 15,580 1.64 -9.26 17,052 15,548 17,000 17,600 -0.3
tonne
China Domestic Hot Rolled CNY/
3,429 -1.21 -14.28 - 3,426 - - -
Steel Average* tonne
USD/
Tin 32,404 11.42 24.27 30,239 30,741 32,000 33,000 5.8
tonne
USD/
Zinc 2,812 -5.59 15.98 2,811 2,857 2,650 2,700 -5.7
tonne
Precious Metals
Gold USD/oz 2,880 9.75 41.86 2,390 2,794 2,500 2,200 4.6
Palladium USD/oz 924 1.51 -2.00 - 975 - - -
Platinum USD/oz 974 8.96 8.60 - 979 - - -
Silver USD/oz 31.99 9.40 41.98 - 31.73 - - -

Note: We forecast a global average of steel prices; therefore, our forecasts are not included on this line. All metals prices except steel, lithium and iron ore refer to generic third-
month contracts. All energy prices refer to generic front-month and all agribusiness refer to second-month contracts unless otherwise stated. - = not available. f = BMI forecast.
Source: Bloomberg, BMI. Last updated: February 27 2025

[Link]/bmi 32

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Upstream Analysis
Asia Machinery Outlook: Mixed Performance In 2025 As Indian Sales Outperform
Key View: Lower cost of machinery will ensure farm equipment and machinery sales hold steady in Asia. We believe that
agricultural production growth, supportive government policies, and the continued decline in the agricultural share of the labour
force will drive investment in productivity-enhancing technologies, with export-oriented markets and businesses expected to lead
this trend. In the short term, the two largest agricultural sectors in the region face contrasting fortunes in terms of machinery
expenditure. Above-average monsoon rainfall will encourage crop sowing in India while downward pressure on agricultural producer
prices in Mainland China could weigh on investment.

Latest Updates

• On December 2 2024, Mahindra & Mahindra announced its tractor sales figures for November 2024. Domestic sales in
November 2024 were at 31746 units, compared to 31069 units during November 2023. Total tractor sales (domestic + exports)
during November 2024 were at 33378 units, compared to 32074 units for the same period in 2023. Exports for the month stood
at 1632 units, a 62% y-o-y growth. In the release, it was noted that with the Kharif harvest season getting completed, farmers
were progressing with Rabi sowing. The marginal decline in the industry is due to a shift in the festive season of Diwali and
Dhanteras as compared to the previous year. With very good reservoir levels and higher MSP for key Rabi crops, farmer
sentiment was positive and cash flows healthy. Good progress in Rabi sowing and a good Rabi crop are expected to further boost
demand for tractors in the coming months.
• On October 1 2024, Mahindra & Mahindra released its sales performance figures for September 2024, which indicated growth in
domestic sales. In September itself, domestic sales amounted to 43,201 units compared to 42,034 units twelve months earlier,
while accumulated domestic sales in FY2024/25 (April-September) amounted to 206,236 units compared to 198,724 units in
the same period in FY2023/24. In the release, it was noted that above-average monsoon rainfall had supported the sowing of
monsoon-planted (kharif) crops while elevated reservoir levels would do the same for winter-planted (rabi) crops.

Improved Monsoon Season Will Support Crop Sowing

India - Cumulative Rainfall (mm)

Source: Haver, BMI

[Link]/bmi 33

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

• In October 2024, Mahindra & Mahindra, the Indian automobile manufacturing firm, announced the incorporation of a new
second-tier subsidiary named Mahindra South East Asia Limited (MSEAL) and a part of Mahindra Overseas Investment Company
(Mauritius) Limited (MOICML). On October 08, MSEAL was incorporated in Thailand and will concentrate on selling tractors, farm
equipment, and related farm machineries in Thailand’s domestic market. The announcement aligns with Mahindra & Mahindra’s
established business plan of expanding its presence in South East Asia.
• In August 2024, Iseki & Co, a Japanese farm equipment manufacturing firm, revealed plans to relocate 90% of its manufacturing
operations destined for overseas markets to Indonesia by 2030. Iseki & Co cited labour cost pressures in Japan as well as reduced
domestic demand for farm equipment as the rationale behind its decision, which follows a July 2024 announcement that a
production plant in Kumamoto would be closed. Other Japanese farm equipment manufacturers, including Kubota and Yanmar
Holdings, are also pursuing similar strategies focused on developing overseas business lines.
• In August 2024, Yanmar Holdings Co, a Japanese farm equipment manufacturing firm, announced the acquisition of CLAAS India,
also a manufacturer of farm equipment, which was due to be completed in the following September. For Yanmar Holdings, the
acquisition will allow for the sale of a wider range of products in India, based in part on CLAAS India’s experience in the
manufacturer of combine harvesters for the Indian market. We expect that above-average rainfall in the June-September 2024
monsoon season will support farm equipment purchases in India through end-2024 and into 2025.
• In August 2024, Kubota Corporation, a Japanese farm equipment manufacturing firm, released its financial results for H1 2024,
which saw a 3.9% increase in total revenue when compared to the same period in 2023 despite a 3.0% decline in sales in Japan
itself. Between the two periods, sales to Asia outside Japan led headline revenue growth, rising from JPY310bn to JPY344bn for a
gain of over 11%. Kubota also noted the sales in Thailand had started to recover following an earlier drought-induced
deceleration. Low rainfall in India in the period also slowed sales.
• In Q2 2024, the farm crops component of Mainland China’s agricultural producer price index (PPI) printed at -3.30%, compared
to -2.40% in Q1 2024 and the fourth consecutive quarter in which it has printed in negative territory. In the same quarter, the
cereal (corn, rice, and wheat) component of the agricultural PPI printed at -4.80%, unchanged from Q1 2024 and the second
consecutive quarter in which it has printed below zero. The headline agricultural PPI printed at -2.90% in Q2 2024, a pullback
from the -3.90% reading in Q1 2024 but the fifth consecutive quarter in which the index has recorded deflation.

[Link]/bmi 34

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Ov
Over
erview:
view: FFactor
actorss That Will Shape The FFarm
arm EEquipment
quipment And Machiner
Machineryy Sector In Asia
Driver Description Indicator(s)

Availability of Agricultural Loans

Enables farmers to invest in farm equipment and
Access To machinery, via loans and credit facilities, and thus serves as
Financial Inclusion (Rural)
Finance a critical driver of the rate of technological adoption in the
agricultural sector.
Interest Rates

Poses a downside risk to agricultural production and Frequency of Extreme Weather Events
productivity as unfavourable cultivation conditions occur
Climate
with a greater frequency, but could also increase demand Increases in Average Ambient Temperatures
Change
for more resilient and efficient farming technologies in
areas most exposed to variable weather conditions. Changes in Rainfall Patterns, Water Availability

Agricultural GDP Growth

Economic Mediates on-farm investment capacities and determines
Growth And the composition of technological demand with respect to Agricultural Income per Capita (Growth, Level)
Income Levels cost.
On-Farm Profit Levels

Agricultural Subsidies (Growth, Level)

Government Supports rates of on-farm technological adoption via cost
Policies And reductions and financial incentives for equipment Crop Price Support Measures
Subsidies purchases.
Mechanisation Initiatives

Irrigation Coverage
Raises the return on investment in and reduces the
Infrastructure operational costs of farm equipment and technologies,
Road Density and Quality
Development increases the realisation of potential efficiency gains from
and de-risks investment in technological adoption.
Rural Electrification

Shapes demand for farm equipment and machinery insofar Agricultural Employment
as a shrinking agricultural labour pool and rising labour
Labour Market costs alter the balance of the cost of the factors of
Labour Costs in Agricultural Areas
Trends production with mechanisation exploited to maintain
output levels while stimulating agricultural productivity
gains. Rural-to-Urban Migration Rates

Alters on-farm economies of scale as farm consolidation

Land Reforms
allows for investment in farm equipment and machinery to Average Farm Size
And Farm Size
be spread over a higher productive potential and so

[Link]/bmi 35

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Driver Description Indicator(s)

Distribution of Farm Sizes and Land Ownership

reduces the payback period.
Land Title Reforms

Consumer Diet Diversification

Market Determines farmer revenue and investment capacities,
Demand And shifts in crop demand have an impact of the types of farm Crop Production (Growth, Level)
Crop Patterns equipment and machinery that are in demand.
Farmgate Prices

Investment in Agricultural Education and Training

Expands the range of technologies that can be utilised to
Technical
generate higher on-farm returns and allows for the greater
Extension And Technical Extension Outreach
exploitation of technological efficiencies from investment
Training
in farm equipment and machinery.
Utilisation Rates

Adoption Rates
Transforms the field of available technologies, delivering
Technological
productivity gains, reducing labour costs, and increasing Economic Factor Shares
Advancements
on-farm efficiency.
R&D Expenditure

Source: BMI

Structural Trends

1. Agricultural Value Added: Growth To Shape Investment, Levels To Determine Technological Demands

The rate of value-added per agricultural worker underpins the investment capacities of a given agricultural sector and also serves as
an indication of the specific markets in which technological adoption and on-farm modernisation is taking place. It could also
indicate markets in which farmers are more receptive to technological investment in order to sustain and enhance productivity in
response to increased competition. The absolute level of value-added per agricultural worker, on the other hand, determines to no
small degree, albeit alongside other factors such as average farm size, the particular class of farm equipment and machineries that
are in demand. For example, all other things being equal, a market in which the growth of value-added per agricultural worker is high
but in which the absolute level of value-added per agricultural worker is low could exhibit rising demand for and adoption of basic
low-cost farm equipment and technologies. In contrast, a market in which the growth of value-added per agricultural worker has
moderated but in which the absolute level of value-added per agricultural worker is high could see stable demand for farm
equipment and machineries, shaped in consequence of the rate of replacement and the pace at which high-end technologies
become obsolete.

[Link]/bmi 36

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Scale And Composition Of Equipment Demand Varies

Select Markets - Value-Added per Agricultural Worker (2015 USD)

Note: May include territories, special administrative regions, provinces and autonomous regions. Source: World Bank, BMI

Between 2018 and 2022, value-added per agricultural worker at the world level increased at an average rate of 2.4% per annum
whereas it rose at an average rate of 6.0% per annum in East Asia and the Pacific (or 6.2% per annum if high income economies are
excluded) and at an average rate of just 1.9% per annum in South Asia. Growth leaders in Asia included Mainland China (7.8% per
annum), Vietnam (7.3% per annum), Mongolia (5.4% per annum), Bhutan (3.4% per annum) and Bangladesh (3.3% per annum). Of
these five markets, the absolute level of value-added per worker in 2022 exceeded the global upper-middle income average in two
(China and Mongolia) while it exceeded the global low-income average in the other three. In the same period, India, which in 2022
saw agricultural value-added per worked exceed the global low-income average, recorded average growth of 1.7% while Thailand,
where agricultural value-added per worker exceeded the lower-middle income average in 2022, saw growth of just 1.5%. Markets
that saw value-added per agricultural worker exhibit a negative average growth rate in the period included the Philippines (-0.3% per
annum), Cambodia (-0.7% per annum), South Korea (-2.3% per annum) and Laos (-2.4% per annum).

In terms of absolute value-added per agricultural worker (measured in constant 2015 US dollars) in 2022, the highest levels in Asia
were found in Japan (USD22,536), South Korea (USD18,697), Malaysia (USD15,373), China (USD7,287), and Mongolia (USD6,290).
Meanwhile, Indonesia (USD3,646), the Philippines (USD3,212), Thailand (USD3,190), Pakistan (USD3,106), Vietnam (USD2,330) and
India (USD2,116) formed a middle-tier group. Those markets at the lower end of the spectrum included Bangladesh (USD1,380),
Laos (USD1,420), Cambodia (USD1,533), Nepal (USD1,652), and Bhutan (USD1,754). These lower-tier markets face several
bottlenecks to growth, including the often small size of the domestic market, low volumes of crop production, limited export
opportunities, inadequate infrastructure, and insufficient investment in downstream value-adding processing capacities. In the case
of Cambodia, for example, rough rice is often exported to Vietnam for processing and subsequent re-export due to insufficient
domestic investment in milling facilities, with the result that value-added potential is not exploited on a domestic basis and thus
investment capacities are restricted. Meanwhile, both Bhutan and Nepal are reliant on imports of staple food items from India,
exposing domestic producers to heightened competition.

[Link]/bmi 37

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

2. Export-Oriented Agricultural Sectors Will Continue To Exhibit Higher Levels Of Investment

Within individual Asian economies, segments of the agricultural sector that are oriented towards and successful in international
export markets often benefit from greater growth potential, more stable demand-side patterns, and supportive government policies,
all of which represent tailwinds to levels of investment in farm equipment and machineries. In addition, export-oriented sectors tend
to attract greater levels of foreign direct investment (FDI) than their domestic-oriented counterparts, which can serve to introduce
new technologies into the sector and to further develop their competitive advantage, thus driving rates of technological adoption.
Greater exposure to international competition could also accelerate the diffusion of technologies and practices developed and first
adopted in foreign markets within export-oriented sectors, which could in turn disperse through domestic-oriented sectors.
Meanwhile, markets in which exports are founded on a robust domestic production surplus tend to be less reliant on imports of the
same product (with exemptions made for intra-product quality and variety differences), which can serve to stimulate domestic
investment in downstream processing facilities and in consequence increase the rate of return on upstream investment in
equipment and machineries.

Export Sales Contingent On Investment In Productivity, Competitive Advantage

Select Market - Agricultural Product Exports (USDbn)

Note: May include territories, special administrative regions, provinces and autonomous regions. Source: Trade Map, BMI

Seven markets in Asia generated an aggregate agricultural trade surplus in 2023: Thailand (USD25.8bn), Indonesia (USD17.1bn),
India (USD11.2bn), Malaysia (USD6.0bn), Myanmar (USD1.5bn), Cambodia (USD1.4bn), and Sri Lanka (USD0.4bn). However, the net
trade position of an individual market is of course not in isolation a usable indicator for the potential farm equipment and machinery
demand in a particular market. Mainland China, for example, produced an agricultural trade deficit of USD127.4bn in 2023, but
nevertheless remains an attractive market for sales in view of the scale of domestic demand, a clear commitment on the part of the
state to accelerate technological adoption and to stimulate agricultural production growth, and the ongoing diversification of the
traditional diet that will give rise to demand for new products. In a similar vein, both South Korea (USD28.4bn) and Japan
(USD60.8bn) operated an agricultural trade deficit in 2023, but both also present significant opportunities for equipment
manufacturers in view of high income levels and downward pressures on the size of the domestic agricultural labour force.
Moreover, established equipment manufacturers in Japan, for example, have sought to expand sales to other faster-growing markets
in Asia.

[Link]/bmi 38

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Indian Tractor Export Profile Based On Low-Cost Positioning

India - Tractor Production & Exports (units)

Source: Tractor and Mechanization Association (India), BMI

The decomposition of an individual market’s net agricultural trade position on a segment-by-segment basis allows for the
identification of specific risks and opportunities, with different drivers of equipment investment often active in net exporting and net
importing segments. Of the net trade surplus markets listed above, export sales tend to be concentrated in a select pool of
products. Major export-oriented sectors in Asia include rice (Thailand, India, Myanmar, and Cambodia), sugar (India and Thailand),
and palm oil (Indonesia and Malaysia). In addition, the world’s largest exporters of aquaculture products in 2023 included China,
Vietnam, Indonesia and Thailand. In these sectors, export sales allow for a more stable revenue flow than would often be the case in
the domestic market alone, which supports higher levels of investment in agricultural technologies. Export sales also generate
foreign exchange, which serves to mitigate domestic currency risks, while exposure to international competitors increases the
incentive to safeguard and improve productivity levels so as to maintain a competitive position. The case of India, however,
highlights the risk of restrictive trade policies being introduced, with foreign sales of both rice and sugar curtailed in recent seasons.

[Link]/bmi 39

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Policies In Place In Mainland China To Encourage On-Farm Mechanisation

China (Mainland) - Agricultural Machinery (units)

Source: NBS, BMI

Net importing segments of the agricultural sector, on the other hand, could benefit from government incentives designed to
strengthen the net trade position of a given market, whether on the grounds of export revenue growth, domestic food security
concerns, or another factor. In China, for example, a persistent and sizeable soybean trade deficit has given rise to policies designed
to encourage domestic production growth, including support for mechanisation. Meanwhile, a trade deficit in a particular product
that is an input to a downstream export-oriented sector can be an indication of value-added growth potential. In Vietnam, for
example, the growth of the animal feed manufacturing sector, supported in part by FDI inflows, has underpinned a widening feed
grain trade deficit. While increased corn imports has supported downstream capacity expansions and technological adoption,
domestic corn producers have faced headwinds in the form of acute international competition, limiting their investment capacities.
In Indonesia, the emergence of a regional cocoa bean processing hub has seen installed processing capacities far surpass domestic
production, rendering utilisation rates and operational margins sensitive to price conditions in international markets.

3. Regional Equipment And Machinery Manufacturers Expand Into Export Markets

Markets in Asia accounted for 10%-15% of world tractor exports in 2023, with Mainland China (USD7.6bn), Japan (USD1.7bn), India
(USD1.1bn), and South Korea (USD1.0bn) all recording foreign sales in excess of USD1.0bn. China was the world’s fifth largest
exporter of tractors in 2023, behind Germany, Mexico, the Netherlands, and the US, having been the eleventh largest in 2019,
behind the four markets mentioned as well as France, Belgium, Japan, Sweden, and Italy. In 2019, the total value of Chinese tractor
exports amounted to 14.1% of those exported by the world’s largest tractor exporter in the same period (in the case of 2019,
Mexico), which had narrowed to 29.9% (also Mexico) by 2022, before surging to 54.4% in consequence of an increase in exports to
sanctions-affected Russia. Prior to the pick-up in sales to Russia, the largest markets for Chinese tractor exports included Vietnam,
Nigeria, Mongolia, Ukraine and Tanzania, which indicates their low-cost nature. In contrast, Japan’s tractor exports were destined for
the US, France, Thailand, Canada, and South Korea, while a desire to expand into lower-cost segments of the export market and to
enhance international competitiveness underpinned announcements by Japanese manufacturers of the establishment of
production hubs in markets such as India.

[Link]/bmi 40

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Mainland China Leads The Region In Foreign Sales Of Tractors

Select Market - Tractor Exports, USDbn (2023)

Note: May include territories, special administrative regions, provinces and autonomous regions. Source: Trade Map, BMI

4. Near-Term Mass Adoption Of Novel Agricultural Technologies Faces Challenges, Despite Promising Case Studies

The class of novel agricultural technologies is broad, including precision agricultural, biotechnology, automation and robotics,
advanced irrigation networks, digital sensors, and vertical farming. These technologies often intend to combine productivity and
efficiency improvements with enhanced sustainability. The adoption of novel digital technologies will continue to be driven by
multiple factors, including the rising cost of agricultural and rural labour, the mounting variability of weather and climatic systems,
and the gradual depletion of new agricultural land into which to expand cultivation. Developers tend to fall into one of two
categories, either indigenous developers responding to a specific local need or multinational agribusiness firms adapting an existing
technological product to a new local market but can also reflect a combination of the two. For example, Mahindra & Mahindra, the
Indian manufacturing firm, has launched both DigiSense, a 4G-enabled remote tractor monitoring application accessible via a
smartphone, as well as an agricultural equipment rental service, called Trringo, which uses a digital platform to connect equipment

and machinery lessors with farmers. As these examples indicate, infrastructure networks, often digital, underpins the operation of
several classes of novel agricultural technologies.

Obstacles to the adoption of novel agricultural technologies include fragmented and small-scale land holdings, which limit the
extent to which economies of scale can be exploited; uneven and sometimes unreliable infrastructure networks; the upfront cost of
new equipment and machineries and inadequate access to sufficient finance; and, the risk-averse behaviour of farmers, in particular
smallholder farmers, and an uncertain return on investment. A 2023 McKinsey report found that adoption in Asia lagged behind
other regions, with 9% of surveyed farmers either using or expecting to use within the next two years a novel agricultural
technology compared to a global average of almost 40%. Just 4% of farmers surveyed in Asia were using or planned to use within
the next two year precision agriculture hardware compared to a global average of 18%. Given these challenges, the diffusion of
novel agricultural technologies in Asia will in all likelihood be concentrated in leading export-oriented higher-value segments of the
sector, notwithstanding select site-specific use cases including vertical farming in high-income urban areas, for the foreseeable
future, with exposure to international competition one driver of adoption. However, external developments, such as the expansion
of digital networks, will serve to accelerate a broader based adoption.

[Link]/bmi 41

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Select BMI Macr

Macroec
oeconomic
onomic FFor
orecasts
ecasts (2019-2029)
Geography Indicator 2019 2020 2021 2022 2023e 2024e 2025f 2026f 2027f 2028f 2029f
Global Real GDP growth, % y-o-y 2.7 -2.8 6.2 3.1 2.7 2.6 2.6 3.0 2.8 2.7 2.6
Asia (R
(Region)
egion) Real GDP growth, % y-o-y 4.0 -0.7 6.6 3.4 4.5 4.1 4.0 3.9 3.7 3.7 3.6
China (Mainland) Real GDP growth, % y-o-y 6.0 2.2 8.1 3.0 5.2 4.8 4.5 4.2 3.9 3.7 3.5
India Real GDP growth, % y-o-y 3.9 -5.8 9.7 7.0 8.2 6.0 6.6 6.5 6.4 6.4 6.4
Indonesia Real GDP growth, % y-o-y 5.0 -2.1 3.7 5.3 5.0 5.0 5.3 5.5 5.4 5.4 5.2
Japan Real GDP growth, % y-o-y -0.4 -4.2 2.6 1.0 1.9 0.6 1.0 0.9 0.8 0.9 1.0
Malay
Malaysia
sia Real GDP growth, % y-o-y 4.3 -5.6 3.3 8.7 3.7 5.0 4.7 4.6 4.5 4.0 4.0
South K
Kor
orea
ea Real GDP growth, % y-o-y 2.2 -0.7 4.1 2.6 1.4 2.1 1.9 1.8 1.8 2.1 2.1
Thailand Real GDP growth, % y-o-y 2.1 -6.1 1.5 2.6 1.9 2.6 3.1 3.2 3.2 3.1 3.0
Vietnam Real GDP growth, % y-o-y 7.4 2.9 2.6 8.1 5.0 7.1 7.4 7.0 6.7 6.6 6.6
e/f = BMI estimate/forecast. Source: National sources, BMI

[Link]/bmi 42

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Asia GM Outlook: Government Regulation Encouraging Adoption, But Cultivation

Faces Strong Opposition
Key View: Governments in Asia are exploring genetically modified (GM) / genetically engineered (GE) crop cultivation, as the need
to innovate and meet increasing food security challenges rises. Among hurdles for biotech companies are staunch public
opposition, regulatory gaps and intellectual property laws. Within the region, India will remain a complex market for GM cultivation
due to regulatory weakness and improper control and monitoring of field trials, although sentiment is improving due to surging
global grain prices that are weighing food security concerns. Parts of South East Asia have been open to GM crops, particularly the
Philippines and Vietnam, but the cultivated area for GM corn has not expanded in recent years.

Latest Developments:

• According to the International Service for the Acquisition of Agri-biotech Applications (ISAAA), the global market of genetically
modified crops is projected to be valued at USD24.8bn in 2024 and expected to reach USD35.6bn with Asia the fastest growing
market.
• According to the ISAAA, Japan continues to be a major importer of GM food and feed, sourcing mostly from the US. Other major
exporters include Canada, Brazil, and Argentina. The Government of Japan approved a total of 334 genetically modified products
for food use as of September 2024. This is according to the latest USDA Foreign Agricultural Service report about the status of
agricultural biotechnology in Japan. However, Japanese farmers do not cultivate any GM seeds.
• In December 2024, Mainland China approved five gene-edited crop varieties and 12 types of genetically modified (GM) soybean,
corn and cotton, expanding approvals to boost high-yield crops, reduce import reliance, and ensure food security. The approved
gene-edited crops include two soybean varieties, and one each of wheat, corn, and rice. The approved varieties include seeds
from Beijing-based feed group Dabeinong and China National Seed Group, a subsidiary of seeds and pesticides maker Syngenta
Group.
• In October 2024, Origin Agritech, a leading Mainland Chinese agricultural technology company, announced the establishment of
the "Origin Marker Biological Breeding Service Consortium" in partnership with China Golden Marker Biotechnology. This
consortium is designed to license Origin's GMO insect-resistant and herbicide-tolerant (IR/HT) traits to a wider range of industry
players and to accelerate the application of Origin's gene editing technology in breeding programs.
• In September 2024, Mainland China approved the safety of gene-edited wheat, moving it closer to commercial production of
genetically modified food crops.
• In June 2024, Thailand implemented a new regulation titled “Certification of Organisms Developed from Genome Editing
Technology for Agricultural Use, B.E. 2567 (2024),” that aims to position Thailand as a global leader in agricultural innovation, in
line with countries such as the US, Japan, and Australia.
• On June 21, 2024, new banana varieties with improved reduced-browning characteristics were determined as non-GMOs in the
Philippines.
• In April 2024, a court in the Philippines banned golden rice, a GM food that had been approved for cultivation in 2021, over
claims by environmental groups that it could contaminate other crops.
• During March 4-6 2024, 26 representatives from all ten member states of the Association of South East Asian Nations (ASEAN)
and Timor-Leste participated in a USDA-funded agricultural biotechnology workshop - along with dozens of private sector
stakeholders at the ASEAN Secretariat in Jakarta, Indonesia. Representatives from each member state presented on regulations
and research updates in their countries, and engaged in substantive conversations on balancing the need to assure the food
safety of genetically engineered (GE) products with the need to innovate and meet increasing food security challenges. The
program increased awareness of the potential benefits of agricultural biotechnology for food security and climate resiliency,
shared experiences and updates on the biotechnology and biosafety policy status of member states, and explored collaboration
between the AMS to promote regulatory harmonisation, streamline approval processes, and adopt effective and efficient
regulatory approaches. Experts from Canada, Australia, the African Union, and the US joined the workshop to provide insights
into the global status of biotechnology and biotechnology products in international trade, as well as highlighted bilateral and
multilateral cooperation and harmonization.
• In December 2023, the Ministry of Agriculture and Rural Affairs (MARA) of Mainland China approved 37 genetically modified (GM)

[Link]/bmi 43

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

corn varieties and 14 GM soybean varieties after a three-year trial. These varieties have been bred for stronger herbicide or insect
resistance and produce higher yields compared to conventional ones. The announcement was the first of its kind by the Chinese
government, and follows a decision from a national committee established by the agriculture ministry in October. China's move
to introduce the cultivation and commercialisation of GM seeds is part of a broader effort to increase domestic food production,
achieve self-sufficiency, and thereby reduce reliance on global markets. These aims are the result of national security concerns
as the market seeks to insulate itself from a volatile international environment, but also of domestic issues. Feeding a growing
and increasingly prosperous population from a dwindling and depleted arable landmass necessitates agricultural reform across
several domains, but obstacles to this reform have proven difficult to overcome.
• On October 17 2023, China’s National Crop Variety Registration Committee for the first time released a list of approved GM corn
and soybean varieties. Overall, 37 GM corn seed varieties and 14 GM soybean seed varieties were approved, with 19 of the former
varieties developed by Beijing Dabeinong Technology Group (BDTG), which also developed five of the latter and four developed
by China National Seed Group, a unit of Syngenta, the Swiss agricultural technology firm that was acquired by China National
Chemical Corporation (ChemChina) in 2017. Reportedly, BDTG accounts for over half of the authorised GM pilot planting area in
China.
• We have long since identified the commercialisation of GM crops as posing an upside risk to our China's grains production
forecasts but do not anticipate their mass utilisation within the medium term. With respect to the GM corn variants that have
now been approved, most combine pest- and herbicide-resistance, with, for example, well over half described as ‘Resistant to
Asian corn borer’. Some claimed crop productivity gains are unremarkable, with the ‘Zhengdan 958D’ variety recorded as
achieving a yield premium of just 0.3% over the base case in 2021, but several exceed a premium of 5.0%, with a premium of
10.2% generated by the ‘Xianda 901ZL’ variety in 2022. Of the 14 GM soybean variants, all are focused on (often glyphosate)
herbicide resistance and are described as achieving an average yield increase of just under 7.0% relative to a baseline.
• However, China's authorities have shown a cautious attitude with respect to the expansion of GM pilot areas, with under 15
hectares (ha) planted in 2021, under 6,700ha in 2022 and about 260,000ha (or 3.9mn mu, a China's unit of area measurement)
in 2023. Xinhua News Agency reports that GM technologies are still not permitted in human-use (ie food) applications, instead
limited to feed and industrial applications, and that GM seed inventories, were approval to be given, would be sufficient to cover
2.0mn ha in 2024. Imports of GM crops are eligible if intended for use in the manufacture of animal feed whereas domestic
cultivation outside MARA approval remains illegal.
• The presence of economies like China and India has led to high growth potential for the GM seeds market in the Asia-Pacific.
The Asia-Pacific GM seeds market has also been geographically segmented mainly into China, India, the Philippines, Japan and
South Korea.
• On August 17 2023, new Japanese government data has found that local GM food crops had shown no evidence of posing
risk to surrounding biodiversity in the past year. Japan has long faced a dilemma when it comes to GM foods and introducing GM
foods on a larger scale in order to address food security issues.
• Asia presents many challenges to biotech companies amid general public opposition to GM food and a weak regulatory
environment, especially in terms of GM cultivation approval processes, proper monitoring of the field trials and intellectual
property policies.
• Although Asia is a major importer of GM food, GM seed cultivation is low and will only make slow progress in the coming years.
• In India, only BT cotton has so far been permitted by the government for cultivation amid longstanding opposition. GM brinjal
and mustard were developed by Indian scientists, but both crops remain unapproved for commercial cultivation. India allowed
the import of 550,000 tonnes of GM soymeal in April 2022 to address feed demand concerns, especially as global cereal prices
had skyrocketed. In Q2 2022, the Indian Ministry of Environment, Forest and Climate Change also relaxed regulation relating to
two gene editing techniques: SDN-1 and SDN-2. That being said, India will remain a difficult market for wider adoption. However,
GMO are being pushed through all fronts of India and field trials of food and non-food GM crops are granted by the local
authorities.
• In April 2022, the New Zealand Productivity Commission published a new report stating that the market needed to undertake a
regulatory review of its biotech regulations. The government entity noted that significant changes in GM technology since the
national regulation was implemented necessitate a fundamental rethink.
• In July 2021, New South Wales lifted a ban on GM after 18 years, a year after South Australia removed its ban. For now, only three
GM crops - Bt and HT cotton, HT canola and sunflower are grown in Australia and the Commonwealth Gene Technology
Regulator will thoroughly undertake future studies on potential varieties. Other GM crops are undergoing experimental field

[Link]/bmi 44

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

plantings.
• As China is moving to expand production of genetically modified crops, it is taking steps to counter sectors of GMO opposition
that have prevented the progress in adoption of the technology. China will make slow but steady progress towards the
commercialisation of GM seeds on a five-year horizon. The authorities are working to bolster China's innovation capacity in
agricultural science and technology, a policy that is in line with five-year development plans published by the Chinese Academy
of Agricultural Sciences (CAAS)
• The Philippines continues to lead in the adoption of GM crops in South East Asia. The Philippines authorised a number of crops,
including eggplant and rice in Q3 2021 while also updating its biotech policies in Q1 2022. While the Philippines has the largest
number of commercial planting of GMO, increasing prices of GM seeds and the dramatic decline of farmers' income, driving
them deeper into indebtedness, are other major concerns against GMOs.

Mainland China: Recent Planting Approvals For GM Seed Varieties In Step With Food Security Drive

In December 2024, Mainland China approved five gene-edited crop varieties and 12 types of genetically modified (GM) soybean,
corn and cotton, expanding approvals to boost high-yield crops, reduce import reliance, and ensure food security. The approved
gene-edited crops include two soybean varieties, and one each of wheat, corn, and rice. The approved varieties include seeds from
Beijing-based feed group Dabeinong and China National Seed Group, a subsidiary of seeds and pesticides maker Syngenta Group.
This follows from September 2024, when Mainland China approved the safety of gene-edited wheat, moving it closer to commercial
production of genetically modified food crops. In December 2023, the Ministry of Agriculture and Rural Affairs (MARA) of China
approved 37 GM corn varieties and 14 GM soybean varieties after a three-year trial. These varieties have been bred for stronger
herbicide or insect resistance and produce higher yields compared to conventional ones. The announcement was the first of its
kind by China's government and follows a decision from a national committee established by the agriculture ministry in October. On
October 17, China’s National Crop Variety Registration Committee for the first time released a list of approved GM corn and soybean
varieties.

We have long since identified the commercialisation of GM crops as posing an upside risk to our China's grains production forecasts
and, while we remain of the view that their mass utilisation will not occur within the medium term, we highlight that the
announcement aligns with widespread efforts to enhance domestic food security.

From the perspective of Mainland China's authorities, GM crop varieties represent a means by which to reduce domestic import
demand via improved crop productivity (and in so doing increase agricultural self-sufficiency) while also supporting the continued
development of the domestic seed technology sector.

In recent years, the relative political importance attached to enhancing agricultural self-sufficiency and
strengthening by China's authorities has steadily grown. China's President Xi Jinping, having first coined the term in 2020,
has referred to food security as a ‘guozhidazhe’, which describes a matter of national strategic importance. While a trend toward
‘securitisation’, a term from the field of international relations that alludes to the re-conceptualisation of political issues into security
concerns, has been evident through much of the recent phases of President XI’s leadership, with the strengthening of national
security in China included as one of the 14 basic policies of ‘Xi Jinping Thought on Socialism with Chinese Characteristics for a New
Era’ (also known as ‘Xi Jinping Thought’), which received its first official mention in 2017, the post-2018 period has seen the
agricultural and food sectors brought more firmly within the security remit.

Here, the US-China trade tensions, which began in 2018 and served as an indication of the broader deterioration in bilateral
relations associated with the Presidency of Donald Trump, served to highlight China’s rising dependence upon US agricultural
exports. In the tit-for-tat development of the trade tensions, China, by some considerable distance the largest global importer of the
oil crop, introduced a 25% tariff on US soybean imports, prompting a 12.2% y-o-y fall in foreign soybean purchases in 2018/19,
necessitating a sudden re-routing of trade demand to Brazil and making clear the built-up Chinese reliance on the US agricultural
sector. The vulnerabilities associated with external reliance were further emphasised during the Covid-19 pandemic and the

[Link]/bmi 45

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

associated disruption to global agricultural markets. Having accounted for 4.5% of world grain imports through the 2010s, the
Chinese share rose to 7.3% in 2020, 11.8% in 2021 and 10.0% in 2022. If soybean is included, China accounted for 23.0% of world
purchases during the 2010s, which then rose to 25.0%, 28.1% and 27.2% respectively.

Land Constraints Add To Importance Of Crop Yield Growth

Select Markets/Regions - Arable Land, ha per capita

Note: Latest data as of May 2024. May include territories, special administrative regions, provinces and autonomous regions. Source: World Bank, BMI

China has adopted a multi-pronged approach to improving agricultural self-sufficiency and domestic food security
of which GM crops are but one component, albeit one with significant upside in the long run. The setting of a ‘red line’ of
120mn ha (or, 1.8bn mu) by the CPC below which agricultural land is not permitted to fall, with grain cultivation to be maintained
over an area no lower than 110mn ha, along with a more recent target of 650mn tonnes for annual grains production indicates a
desired grain yield of about 5.9 tonnes per hectare, which China has exceeded since 2015. In 2021, per World Bank data, China’s
average grain yield stood at 6.3 tonnes per hectare, well below the US peak of 8.6 tonnes per hectare, achieved in 2016, but above
the world average of 4.2 tonnes per hectare. The area of arable land per capita is about 45% of that of the world average and has
been in decline since the mid-1980s. In addition, the accumulation and management of significant volumes of grain inventories has
also been a prominent feature of domestic food security policy while foreign policy has also been leveraged to the same end.

With respect to crop-specific measures, designed to complement the GM developments described above, China has focused much
of its attention on corn and soybean, both crops of which China was the largest global importer in 2022 and in which the US
accounts for a high share of world exports. With respect to corn, China signed a phytosanitary agreement with Brazil midway
through 2022, which opened up its domestic market to Brazilian corn exports. In December 2022, China purchased close to 1.1mn
tonnes of corn from Brazil, which served the short-term need to make up for Ukraine’s earlier corn exports to China, disrupted by
the Russia-Ukraine war, as well as the longer-term goal of reducing bilateral exposure to the US, which supplied more than 65% of
China’s corn imports between 2020 and 2022. As for soybean, the concentration of world exports in a few markets, with the US and
Brazil accounting for over 80% of global sales since 2010, necessarily limits the extent to which trade diversification can serve as a
means to improve food security. This being the case, the Chinese authorities have introduced several domestically focused soybean
policies, such as the implementation of declining targets for the soy meal content of animal feed and the encouragement of local
soybean production, which exceeded 20mn tonnes (albeit against over 115mn tonnes of domestic consumption) for the first time
in 2022/23.

[Link]/bmi 46

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Foreign Soybean Purchases Reached Record High In 2023

Mainland China - Soybean Imports, mn tonnes

Source: GACC, BMI

India: Highly Challenging Market

India remains a highly challenging market for GM seedmakers owing to the market's prolonged regulatory uncertainty, weak
intellectual proprietary rules and vocal public opposition to GMOs. As of 2025, only Bt cotton is allowed for commercial cultivation,
and this accounts for around 95% of India’s total cotton production. That said, regulatory authorities have also now granted
biosafety authorization for environmental release of GE eggplant and mustard events. Soybean and canola oils derived from select
GE soybean and canola events, along with some food ingredients from microbial biotechnology are approved for import.

While public opinion about biotechnology and GE crops is generally ambivalent, political pressure continues to hamper the
regulatory environment, as per the USDA. Several anti-biotech environmental, farmer and consumer groups, often supported by
Greenpeace and other international affiliates, run aggressive and sustained campaigns against GE crops and products in India. Most
Indian farmers, except cotton growers and a few farmers planting illegal GE crops, lack awareness of the technology due to the
absence of other GE field crops (some mired in the regulatory pipeline). Major industry associations are generally supportive of
agricultural biotechnology and GE crops. Most agricultural researchers and Indian scientists believe that biotechnology is an
important tool for addressing India’s future food security, sustainability and climate change concerns. Success has been limited due
to adverse media campaigns, and several state governments have adopted restrictive policies (bans on GE crop field trials),
discouraging biotech research and development. We expect limited improvement to this dynamic in 2024 and beyond.

South East Asia: General Stagnation With Few Bright Spots

The South East Asia region has been gradually making progress in terms of GM cultivation approval over the past few years. The
Philippines continues to lead the region’s GM market, Vietnam commercialised GM corn in 2015 and Indonesia may be the next
market to adopt GM plantings, especially GM sugarcane, as significant numbers of corn, soybean and other crop varieties have
undergone risk assessments since 2017/18. Cambodia and Laos could potentially follow suit in the long term once adequate
biosafety regulations have been established. Despite authorities' approval for cultivation, we note that GM crop plantings have
stagnated at very low levels over recent years due to public opposition. This, coupled with the fact that South East Asia
cultivates limited volumes of corn and soybean, means that the region will remain a small market for GM seeds at present.

[Link]/bmi 47

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Philippines - Early GM Adopter: The Philippines is a regional leader regarding GM adoption and production as it was the first
market in Asia to plant GM corn in 2003. The Philippines has been a pioneer within Asia in adopting biotechnology crops, and
recently approved Bt cotton as the fourth GE crop cleared for commercial propagation after corn (2002), rice (2021), and eggplant
(2022). The biosafety permit for commercial propagation of Bt cotton developed by the Philippine Fiber Industry Development
Authority (PhilFIDA) was issued on August 24 2023. Bt cotton replaces the need to control the bollworm through the application of
synthetic chemical pesticides harmful to human health and the environment. Bt cotton is resistant to bollworm (Heliothis armigera),
as it contains the Bt fusion gene GFM Cry1A, synthesized based on the protein template of Cry 1Ab and Cry 1Ac protein. Bt cotton
includes a gene 5 taken from the soil bacterium Bacillus thuringiensis (Bt), which was also introduced in corn and eggplant in the
Philippines. Field trials have shown more harvestable bolls and reduction in pesticides application.

The Philippines ranked 12th among the 29 countries in the world that planted biotech crops in 2019. Planting of Bt eggplant and
golden rice continues while the GE corn area planted has increased from 10,700 ha in 2003 to 576,000 ha as of 2023. The
Philippines is the first country in the world to approve Golden Rice for commercial propagation. Moreover, it is first in South East Asia
to issue regulatory frameworks on GE crops for cultivation and passed a regulation for plants and plant products derived from the
use of plant breeding innovations (PBIs), also referred to as New Plant Breeding Techniques (NBTs).

The Philippines was the eighth-largest market for US agricultural and related products in 2022 with exports reaching USD4.1bn, up
17% from 2021. The country continues to be the largest US soybean meal market, with USD1.2bn in sales in 2022. We expect the
Philippines to remain at the forefront of Bt adoption in the region over the coming years.

Indonesia - Government Support Rising: President Jokowi stated his support for the utilisation of GE crops (for example
soybeans) in his September 2022 speech. To date, ten GE events have been allowed for cultivation in Indonesia (including one GE
sugarcane, one GE potato and eight GE corn varieties).

Vietnam - Slow Start To GM Cultivation Since Adoption In 2015: With the adoption of GM corn in 2015, Vietnam became the
29th market globally to commercialise a biotech crop. GM corn cultivation came in at 3,500ha planted in 2015 and grew to
45,000ha in 2017, which is low compared with the 1.1mn ha of corn cultivated in the market. From January to October 2020, the
Ministry of Agriculture and Rural Development approved 14 more GM products for corn, soybeans, canola, cotton and sugar beets.
Among those, six cotton products were approved only for feed use. These approvals bring the total number of GM products
approved for food and feed use in Vietnam to 45. There have also been attempts by the sector to convince the government to
conduct field trials to show the effect of GM corn hybrids in combating the fall armyworm, which is an ongoing issue in the market.

Thailand - Blanket Ban For Now: Thailand appears to be one of the South East Asian markets most opposed to GMOs as it has a
de facto ban on GM crop cultivation. In 2019, authorities had drafted a new Biosafety bill which offers improved regulatory
framework for agricultural biotechnology - including research, field trial and commercialisation. Few additional details have emerged
as of May 2022 but should the bill be passed, GM commercialisation would still take years.

[Link]/bmi 48

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Asia Fertiliser Outlook: Application Growth Under Pressure As Farming Costs Remain
High
Key View: Fertiliser prices are facing an upside risk due to the conflict in the MENA region. We do not see a strong rise in application
in Asia as farm profitability remains pressured. Overall, still high input costs will restrict farm production and fertiliser usage. Asia will
remain a top global consumer of fertilisers in the long term.

Latest Developments

• In October 2024, Managing Director of Yara South Asia, Sanjiv Kanwar, said in a business interview that Soil degradation and
nutrient depletion pose significant challenges to long-term agricultural productivity in India. According to Kanwar, to achieve
balanced plant nutrition in India, a multi-pronged approach is essential. This includes promoting soil testing and farmer
education on balanced NPK fertilisation, re-distributing subsidies to incentivise P&K fertiliser use, ensuring the availability of
these fertilisers, and advocating for innovative solutions like high concentration phosphatic fertilisers and foliar application
methods.
• In September 2024, Malaysia owned Ancom Crop Care Sdn Bhd (ACC) and China’s Sichuan Kewo Agriculture Technology Co
(Kewo) signed a memorandum of understanding (MoU) to venture into the fertiliser market in Malaysia and Southeast Asia,
promoting sustainable farming.
• In June 2024, Indonesia’s state-owned fertilizer producer, Pupuk Indonesia, announced intentions to tap into rising demand for
‘clean’ ammonia by accelerating its development projects. Pupuk accounts for 5% of global ammonia production.
• In June 2024, the Indian government revised its guidelines to increase green ammonia allocation for the fertiliser sector to
750,000 lakh tonnes per annum from 550,000 lakh tonnes per annum in response to the rising demand for green hydrogen
driven by enhanced efforts to implement the National Green Hydrogen Mission.
• In August 2024, Anglo American signed agreements with Chinese fertiliser companies Sinochem Fertiliser and BeiFeng AMP to
develop the market for polyhalite fertiliser products in Mainland China. The partnership will include collaborative research on
arable crops such as corn, soybean, potato, rice and high value ones like apple, citrus and grapes.
• In August 2024, Essa Group, Indonesia's largest private liquefied petroleum gas refiner and ammonia plant operator, signed a
memorandum of understanding with Tanzanian government entities to establish a USD 1.3 billion urea fertiliser factory near
Mtwara in southern Tanzania. The facility, which will produce one million tonnes of fertiliser annually, is scheduled for
construction completion by 2027, with production set to begin in 2029. Fertiliser use in Tanzania is notably low at 9.3 kg per
hectare of arable land, compared to the global average of 139.8 kg. However, fertiliser consumption increased from 500kt in
2022/2023 to 800kt in 2023/2024, with future demand expected to reach one million tonnes. Currently, Tanzania imports 90%
of its fertiliser needs. The new plant is anticipated to address Tanzania's fertiliser shortage, reduce reliance on imports, save
foreign currency, and enable exports to neighbouring countries.
• In August 2024, Mangalore Chemicals & Fertilisers (MCF) merged with Paradeep Phosphates, creating one of India’s largest
integrated private sector fertiliser companies. Paradeep is a leading Indian producer of phosphatic fertilisers with a 3mnt
capacity, split between Odisha and Goa.
• In August 2024, news reports revealed that the Indian Farmers Fertiliser Cooperative (IFFCO), a major chemical fertiliser producer
in India, has invested INR638cr in nano fertiliser production plants in Uttar Pradesh.
• In August 2024, news reports revealed that the Indonesian government is encouraging the domestic fertiliser industry to
develop cleaner technologies for its production processes. The government has also added another IDR7.1trn to the IDR26.6trn
fertiliser subsidy budget for 2024.
• In July 2024, the Thai cabinet approved a new fertiliser subsidy scheme that replaced the previous farmers’ allowance
programme under which the government offered cash at THB1,000 per rai to farmers, with a ceiling of 20 rai (3.2 hectares). In
2023, the government spent THB56bn for the allowance programme. While the previous subsidy paid about THB500 more,
most of the money in the previous scheme went to landlords whose lands were rented by farmers but the new scheme would
ensure that farmers would get the money.
• In July 2024, Phosagro, Russia's leading fertiliser maker, called on India to drop its 5% import duty for Russian producers to ensure
stable supplies in the future. India, the world's second-largest fertiliser importer, sourced a quarter of all its imported fertiliser

[Link]/bmi 49

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

from Russia in 2023. Phosagro's exports to India grew six-fold in 2022 alone, following Western sanctions.
• In June 2024, the Indian government announced that it has expanded a massive state-backed supply auction that will see it buy
200,000 tonnes more green hydrogen-based ammonia than it originally planned on behalf of the fertiliser sector, as a result of
higher-than-expected demand for the product.
• In February 2024, India's Union Budget for fiscal year 2024-25 (FY25) allocated INR1.64trn for fertiliser subsidies, lower than the
revised estimate of INR1.9trn allotted for FY24. Though India is moving toward gaining self-sufficiency in urea, it still depends on
imports to meet its rock phosphate demand. The reduced subsidies incorporate expectations of lower fertiliser prices in 2024.
The Indian government has been taking concerted efforts towards producing nano liquid urea in the country. The total number
of plants producing this variety of urea will increase to 13 by 2025 from nine at present. These plants would cumulatively
produce 44 crore bottles of 500ml nano urea and DAP (di-ammonium phosphate), which would help to fulfil domestic demand
and reduce dependency on fertiliser imports. Indian fertiliser use has increased substantially over the past decade, but we expect
this growth to stall as the government makes efforts to improve fertiliser use efficiency. Nevertheless, we expect the government
to continue to provide fertiliser subsidies over the coming years due to the importance of the agricultural sector as a political
base, helping to maintain demand.
• According to the South Korean government in January 2024, the market is also diversifying to receive imports from countries like
Vietnam, Indonesia and Saudi Arabia and will continue this trend going forward.
• According to news reports, China has asked 15 major fertiliser trading firms to limit their total exports in 2024 to 944,000 metric
tons, and is expected to issue quotas to other manufacturers.
• In January 2024, Cinis Fertilizer has signed a letter of intent with the Japanese ITOCHU Corporation with the goal of establishing
operations in Asia. The companies intend to cooperate in order to enter into binding sales and delivery agreements and to study
the conditions for producing environmentally friendly mineral fertilisers in Asia.
• South East Asia remains a bright spot for fertiliser consumption in Asia, while Indonesia is expected to be an outperformer and
Vietnam an underperformer. Emerging markets in Asia, such as Myanmar and Cambodia, will also see growth as demand starts
from a low base. India is undergoing a revival of its nitrogen fertiliser industry, which will lead to lower imports in the coming
years.

Fertiliser Prices Still Low, But Face Upside Risks Due To MENA Conflict

With no major agricultural producers in MENA, the principal short-term vector between heightened geopolitical
tensions in the region and international agricultural prices is the fertiliser market, which has also faced disruption
due to the recent impact of the Atlantic hurricane season on regional production in the US Gulf. With respect to MENA
tensions, the risk to fertiliser prices is twofold. First, production costs in the fertiliser sector are sensitive to fluctuations in the price of
natural gas, which represents the principal feedstock in the manufacture of nitrogen-based (n-based) fertilisers as well as the
principal fuel in the fertiliser production process. The cost of natural gas represents 60%-80% of the variable input costs in the
production of n-based fertilisers. We have found a positive correlation of 0.36 between the contemporaneous month-on-month
movements of the World Bank’s natural gas and fertiliser price indices, which rises to 0.46 when assessed on the basis of a one-
month lag in fertiliser price index movements. Given the current environment of elevated natural gas prices in Europe as well as
Qatar’s position as a major supplier of liquefied natural gas to Europe, fertiliser production costs in the region will be most sensitive
to an increase in geopolitical risk premia.

Second, several MENA markets are major international fertiliser exporters, which renders the fertiliser market vulnerable to
production and shipping disruptions in the Middle East and neighbouring markets. Oman, Egypt, Qatar and Saudi Arabia are all
sizeable exporters of n-based fertilisers while Egypt and Israel are significant exporters of phosphatic fertilisers and Jordan is an
important exporter of potassic fertilisers. Meanwhile, the landfalls of Hurricane Helene and Hurricane Milton have resulted in
fertiliser production outages in the US Gulf, where hurricane-induced damage to regional transportation and export infrastructure
could prolong disruption in the sector, which will provide additional support to prices. In the month to date up to October 15, CBOT-
listed third-month futures contracts for Middle East and US Gulf granular urea have risen 6.4% and 5.1% respectively.

[Link]/bmi 50

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

In general, the reconfiguring and rebalancing of bilateral fertiliser trade flows, such as the gradual adaptation of Belarussian potash
exporters to the loss of access to the Baltic Sea, as reflected in the evolution of the market share held by major exporters in large
import markets have driven the downfall of fertiliser prices along with a host of other factors. Lower fuel costs have eased fertiliser
production costs, while falling international prices for agricultural commodities have eroded fertiliser affordability in certain markets
and, therefore, trimmed demand. In addition, the price environment of 2021 and 2022 prompted the closure of fertiliser
manufacturer plants in higher-cost locations, such as Europe, and also encouraged investment in new capacities in lower-cost
markets, such as an expansion of potash production in Laos. The erosion of conflict premia has also served a significant role.

That said, we have noted that costs remain well-above pre-Covid norms and so continue to pose a downside risk to our agricultural
production forecasts. On a regional basis, differences in capacities to finance higher fertiliser imports costs will also be borne out in
differences in terms of access.

As a sizeable component of on-farm production costs, increases in fertiliser prices have the potential to feed through into farmgate
prices and then on to food prices, stoking inflationary pressures. In the US, for example, the USDA estimate that fertiliser costs
account for almost 45% of total operating expenses for corn and wheat farmers and around 25% for soybean farmers. High fertiliser
prices can see a reduction in crop acreage and/or a reduction in fertiliser application rates, both of which would be expected to
weigh on harvested volumes.

Recent Fertiliser Price Gains Pose Upside Risk To Agricultural Production Costs
Granular Urea (USD per tonne)

Note: CBOT-listed third-month futures contracts. Source: Haver, BMI

Mainland China: Slowdown In Production And Consumption

According to the International Fertiliser Association (IFA), Fertiliser consumption in East Asia is expected to be driven by markets
other than China during 2024 to 2028.

The operating environment for China's fertiliser and pesticide sector is becoming increasingly challenging amid the rise in
environmentally friendly policies, and we do not anticipate any significant growth in Chinese ammonia and urea production over
the coming years. Apart from stricter policies and enforcement of rules, elevated coal prices in recent months have pushed up the
cost of urea production and forced some production capacity of ammonia and urea to go offline.

[Link]/bmi 51

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Since 2021 and up to the time of writing on June 2024, China has increased financial assistance to farmers, prohibited the export of
certain fertilisers (to calm domestic price inflation), and expanded subsidies for investments in agricultural technologies and other
inputs. China's restrictions on the export of phosphate rock as well as a strengthening of export restrictions across all fertiliser
products ought to have limited the impact of high global fertiliser prices on application rates in China, and we do not expect
nutrient-related fertiliser declines over the coming harvests.

In general, China's fertiliser use is declining. Since 2015, total (nitrogen, potash and phosphate) fertiliser use fell from 53.3mn tonnes
to 45.4mn tonnes in 2019 (in terms of nutrients). This fall was mainly owing to reduced nitrogen fertiliser, the most-used type in the
market. The authorities' increasingly strict stance on environmental protection is impacting the use of fertiliser, as China's excessive
application of inputs has led to severe soil degradation and the release of nitric oxide (a greenhouse gas). This has already
contributed to use reducing from an average of 464.6kg/ha of arable land in 2015 to 393.2hg/ha in 2018. However, consumption
per hectare is still well above the world average of 136kg/ha in 2018, and we expect this downward trajectory to continue as the
authorities limit the expansion of agricultural land.

Belarus And Russia Gaining Market Share Fast

Mainland China - Fertiliser Imports By Partner, USDmn (2019-2023)

Note: May include territories, special administrative regions, provinces and autonomous regions. Source: Trade Map, BMI

China is a major importer of potash acquired by means of annual contracts agreed in the second half of the calendar year. We note
that the ban on imports of potash fertiliser from Belarus introduced by the EU in June 2021 will continue to have an impact on trade
dynamics in 2024. The ban omitted contracts signed prior to June 26 2021, and after these contracts expired Belarus has been
looking to markets outside of the EU, especially China, keeping supply of potash fertiliser in the market intact and helping to keep a
lid on prices. At present, there is significant uncertainty regarding the renewal of Chinese potash acquisitions from Belarus. The
Government of China government has not stated if its intends to continue doing business with Belarus or suspend trade in line with
EU-US measures.

[Link]/bmi 52

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Application To Remain Under Pressure As Farm Incomes Struggle

India - Fertiliser Imports By Partner, USDmn (2019-2023)

Note: May include territories, special administrative regions, provinces and autonomous regions. Source: Trade Map, BMI

India: Government Subsidies Less In 2024-2025

In February 2024, India's Union Budget for fiscal year 2024-25 (FY25) allocated INR1.64trn for fertiliser subsidies, lower than the
revised estimate of INR1.88trn allotted for FY24. Though India is moving toward gaining self-sufficiency in urea, it still depends on
imports to meet its rock phosphate demand. The reduced subsidies incorporate expectations of lower fertiliser prices in 2024. The
Indian government has been taking concerted efforts towards producing nano liquid urea in the country. The total number of plants
producing this variety of urea will increase to 13 by 2025 from nine at present. These plants would cumulatively produce 44 crore
bottles of 500ml nano urea and DAP (di-ammonium phosphate), which would help to fulfil domestic demand and reduce
dependency on fertiliser imports. Indian fertiliser use has increased substantially over the past decade, but we expect this growth to
stall as the government makes efforts to improve fertiliser use efficiency. Nevertheless, we expect the government to continue to
provide fertiliser subsidies over the coming years due to the importance of the agricultural sector as a political base, helping to
maintain demand.

India accounts for 15% of global fertiliser use and 80% of fertiliser use in South Asia. In India, government supports fertiliser
purchases by farmers where urea is the main used product.

The administration of Indian Prime Minister Narendra Modi has consistently maintained financial support to the sector with the
stated aim of fuelling its continued expansion. Agricultural policies, such as the minimum support prices (MSP) scheme and fertiliser
subsidies, are designed to bolster farmer incomes, an important driver of rural economic development, as well as to encourage
spending on agricultural infrastructures (which remain patchy) and capital investment in the sector.

Government initiatives to limit urea consumption are slowly paying off. Over the long term, we expect India’s fertiliser consumption
rates to begin cooling off as the sector matures. The government’s ongoing goal of improving efficiency in the use of fertiliser will
also weigh on sales volume growth over the coming years, but this is likely to be partially offset by the likely expansion of crop area.
The government is highly likely to continue to provide fertiliser subsidies over the coming years. With state and general elections
occurring in 2024, we expect that the government will seek to keep the support of the market's large agricultural sector and that
they will therefore ensure that fertiliser are kept at an affordable price.

[Link]/bmi 53

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Urea Most Widely Used Fertiliser In India

India - Fertiliser Application By Type, tonnes

Note: As of August 2024, 2021 is latest data available. Souce: FAO, BMI

India - FFer
ertiliser
tiliser Subsidy Rates (INR/K
(INR/KG)
G)
Nutrient 2011/ 2012/ 2013/ 2014/ 2015/ 2016/ 2017/ 2018/ 2019/ 2020/ Kharif Kharif Kharif Kharif
12 13 14 15 16 17 18 19 20 21 2021/ 2022/ 2023/24 2024/
22 23 25
Nitr
Nitrogen
ogen 27.2 24 20.9 20.9 20.9 15.9 19 18.9 18.9 18.8 18.8 92.0 76.5 47.0
Phosphor
Phosphorous
ous 32.3 21.8 18.7 18.7 18.7 13.2 12 15.2 15.2 14.9 45.3 72.7 41.0 28.7
Potassium 26.8 24 18.8 15.5 15.5 15.5 12.4 11.1 11.1 10.1 10.1 25.3 15.91 2.38

Source: Ministry of Chemicals and Fertilizers, BMI

India's Fertiliser Policy: Usage Imbalances To Remain Pronounced Until Urea Reform

While India's government has maintained its support agriculture via fertiliser subsidies following the re-election of Prime Minister
Narendra Modi in 2019, the overarching goal to instill a more balanced use of fertiliser (away from urea) and to boost fertiliser
efficiency will keep demand growth subdued over the coming years. Long-standing input subsidies in India, particularly for urea
fertilisers, have led to fertiliser overuse, severe imbalance in fertiliser use (overuse of nitrogenous fertilisers at the expense of
phosphatic and potassic fertilisers), and soil degradation and sub-optimal yields. Aware of this weakness, Modi is aiming to
reduce fertiliser use and has in the past considered reforming some of the most sensitive policies before renouncing; however,
reforming the sector is politically sensitive given the political significance of farmers in elections. Modi has implemented other
fertiliser and agricultural policy changes that are transforming the fertiliser sector and that are aimed at improving its efficiency.
These are outlined below:

• Since 2015, all urea fertiliser consumed in the market must be neem coated, which allows for a slower and more efficient release
of the nutrients into the ground.
• The distribution of Soil Health Cards, launched in 2015, aims to address the imbalanced application of fertilisers.
• The rolling out of the Direct Benefit Transfer (DBT) Policy in 2018, which is a new subsidy-dues settlement system, aims
to improve subsidy efficiency. The DBT Policy (whereby the government pays subsidies to fertiliser companies only after they

[Link]/bmi 54

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

have made authenticated sales to farmers) is another sign that the Indian government is looking to increase efficiency in the
sector.
• The roll out of phase two of the DBT Policy will encourage the direct transfer of subsidy funds to farmers directly in a bid to
improve efficiency.
• The urea pricing policy is another aspect of fertiliser policy reform in which India has made little progress. Urea remains the only
fertiliser yet to be deregulated in terms of price, and very low set prices have encouraged farmers to increase the use of nitrogen
fertiliser. This has created severe imbalances in overall fertiliser consumption that have adversely affected soil health and long-
term yields.

India's Fertiliser Production: Witnessing A Boom

India's government aims to reduce its import dependence on nitrogen fertiliser and is reviving brownfield plants and encouraging
investment in greenfield projects. Chambal Fertilisers and Chemicals, one of the largest private sector fertiliser producers in
India, commenced commercial production from its Gadepan-III Plant in January 2019. At least five other projects are also being
developed, which are supposed to come online by 2024 and will significantly boost India's nitrogen fertiliser production. The
public sector is heavily driving this trend as many of these projects are being undertaken by newly created public sector joint
ventures. As a result of these investments, we expect India's fertiliser net imports to trend lower in the coming years.

South East Asia: Agricultural Yields To Support Uptick In Fertiliser Demand

We estimate crop production in the region to remain broadly healthy in 2023/24 as has been the case over recent seasons, with
rice and palm oil output on a steady uptrend.

• We are particularly positive regarding long-term demand growth in Thailand, Indonesia and emerging agribusiness markets such
as Cambodia and Myanmar, which are recording robust growth in crop output. For example, fertiliser imports in Myanmar have
been growing at a fast pace in recent years.
• Vietnam's demand will be weak owing to an excessive application of fertilisers and the slowdown in crop production growth as a
result of area cultivated and yield expansion constraints.
• The upward trends in South East Asia will be particularly positive for nitrogen demand (rice, fruit and vegetables) and potash
consumption growth (palm oil and sugar crops, for example, need more potash-based nutrients than grains).

[Link]/bmi 55

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Selected AP
APA
AC Mark
Markets
ets - Gr
Grain
ain Pr
Production
oduction FFor
orecasts
ecasts (2020-2028)
Geography Indicator 2020 2021 2022e 2023e 2024f 2025f 2026f 2027f 2028f
Wheat
Austr
Australia
alia production, 14,480.2 31,923.0 36,250.0 40,545.0 25,000.0 30,500.0 30,805.0 31,113.0 31,424.2
'000 tonnes
Wheat
Austr
Australia
alia production, % -17.7 120.5 13.6 11.8 -38.3 22.0 1.0 1.0 1.0
y-o-y
Corn
Austr
Australia
alia production, 267.6 356.1 440.0 396.0 403.9 412.0 420.2 428.6 437.2
'000 tonnes
Corn
Austr
Australia
alia production, % -18.2 33.1 23.6 -10.0 2.0 2.0 2.0 2.0 2.0
y-o-y
Rice
Austr
Australia
alia production, 36.0 330.0 500.0 425.0 429.3 429.3 433.5 433.5 437.9
'000 tonnes
Rice
Austr
Australia
alia production, % -25.0 816.7 51.5 -15.0 1.0 0.0 1.0 0.0 1.0
y-o-y
Wheat
China
production, 133,600.0 134,250.0 136,946.0 137,723.0 136,590.0 140,000.0 142,000.0 143,900.0 145,700.0
(Mainland)
'000 tonnes
Wheat
China
production, % 1.6 0.5 2.0 0.6 -0.8 2.5 1.4 1.3 1.3
(Mainland)
y-o-y
Corn
China
production, 260,779.0 260,670.0 272,552.0 277,200.0 288,840.0 294,500.0 299,801.0 305,197.4 310,691.0
(Mainland)
'000 tonnes
Corn
China
production, % 1.4 0.0 4.6 1.7 4.2 2.0 1.8 1.8 1.8
(Mainland)
y-o-y
Rice
China
production, 146,730.0 148,300.0 148,990.0 145,946.0 144,620.0 145,800.0 147,800.0 149,000.0 149,700.0
(Mainland)
'000 tonnes
Rice
China
production, % -1.2 1.1 0.5 -2.0 -0.9 0.8 1.4 0.8 0.5
(Mainland)
y-o-y
Wheat
India production, 103,600.0 107,860.0 109,586.0 107,742.0 110,555.0 112,000.0 114,000.0 115,700.0 117,100.0
'000 tonnes
Wheat
India production, % 3.7 4.1 1.6 -1.7 2.6 1.3 1.8 1.5 1.2
y-o-y
Corn
India production, 28,766.0 31,647.0 33,730.0 38,085.0 35,675.0 37,000.0 38,300.0 39,650.0 41,000.0
'000 tonnes
India Corn 3.8 10.0 6.6 12.9 -6.3 3.7 3.5 3.5 3.4

[Link]/bmi 56

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Geography Indicator 2020 2021 2022e 2023e 2024f 2025f 2026f 2027f 2028f
production, %
y-o-y
Rice
India production, 118,870.0 124,368.0 129,471.0 135,755.0 136,700.0 137,930.0 138,850.0 139,500.0 139,900.0
'000 tonnes
Rice
India production, % 2.0 4.6 4.1 4.9 0.7 0.9 0.7 0.5 0.3
y-o-y
Corn
Indonesia production, 12,000.0 12,600.0 12,700.0 12,900.0 12,900.0 13,420.0 13,685.0 13,960.0 14,235.0
'000 tonnes
Corn
Indonesia production, % 0.0 5.0 0.8 1.6 0.0 4.0 2.0 2.0 2.0
y-o-y
Rice
Indonesia production, 34,700.0 34,500.0 34,400.0 34,000.0 32,800.0 33,800.0 33,650.0 33,450.0 33,250.0
'000 tonnes
Rice
Indonesia production, % 1.5 -0.6 -0.3 -1.2 -3.5 3.0 -0.4 -0.6 -0.6
y-o-y
Corn
Malay
Malaysia
sia production, 58.0 58.0 57.4 56.8 56.3 55.7 55.2 54.6 54.1
'000 tonnes
Corn
Malay
Malaysia
sia production, % 0.0 0.0 -1.0 -1.0 -1.0 -1.0 -1.0 -1.0 -1.0
y-o-y
Rice
Malay
Malaysia
sia production, 1,825.0 1,800.0 1,677.0 1,700.0 1,750.0 1,758.7 1,767.5 1,776.4 1,785.3
'000 tonnes
Rice
Malay
Malaysia
sia production, % 0.0 -1.4 -6.8 1.4 2.9 0.5 0.5 0.5 0.5
y-o-y
Corn
Philippines production, 8,030.0 8,352.0 7,800.0 8,200.0 8,375.0 8,422.0 8,511.0 8,600.0 8,689.0
'000 tonnes
Corn
Philippines production, % 5.5 4.0 -6.6 5.1 2.1 0.6 1.1 1.0 1.0
y-o-y
Rice
Philippines production, 11,927.0 12,416.0 12,540.0 12,625.0 12,300.0 12,650.0 12,775.0 12,900.0 13,025.0
'000 tonnes
Rice
Philippines production, % 1.7 4.1 1.0 0.7 -2.6 2.8 1.0 1.0 1.0
y-o-y
Corn
Thailand production, 4,500.0 5,600.0 5,300.0 5,750.0 5,876.0 5,925.0 5,989.0 6,053.0 6,117.0
'000 tonnes

[Link]/bmi 57

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Geography Indicator 2020 2021 2022e 2023e 2024f 2025f 2026f 2027f 2028f
Corn
Thailand production, % -19.6 24.4 -5.4 8.5 2.2 0.8 1.1 1.1 1.1
y-o-y
Rice
Thailand production, 17,655.0 18,863.0 19,878.0 20,909.0 20,000.0 20,700.0 21,100.0 21,380.0 21,640.0
'000 tonnes
Rice
Thailand production, % -13.2 6.8 5.4 5.2 -4.3 3.5 1.9 1.3 1.2
y-o-y
Corn
Vietnam production, 4,731.0 4,558.0 4,446.0 4,423.0 4,350.0 4,300.0 4,280.0 4,300.0 4,320.0
'000 tonnes
Corn
Vietnam production, % -2.9 -3.7 -2.5 -0.5 -1.7 -1.1 -0.5 0.5 0.5
y-o-y
Rice
Vietnam production, 27,100.0 27,381.0 26,670.0 26,940.0 27,040.5 27,193.3 27,321.5 27,444.5 27,562.9
'000 tonnes
Rice
Vietnam production, % -0.9 1.0 -2.6 1.0 0.4 0.6 0.5 0.5 0.4
y-o-y
Note: May include territories, special administrative regions, provinces and autonomous regions. Source: Local sources, BMI

[Link]/bmi 58

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Downstream Analysis
Food
Key View: Food spending in Pakistan will grow slower in 2024 and 2025, with a focus on essential and durable foods due to supply
issues. Fresh and preserved fruits will see the weakest growth. Over the medium term, spending will rise, driven by incomes and
convenience food demand, despite inflation and foreign exchange risks. Dairy; rice, bread and cereals; meat and poultry; and oils
and fats will grow significantly, with dairy remaining dominant.

Latest Updates

• We forecast that spending on food in Pakistan will grow by 10.1% y-o-y in 2024 and 9.2% in 2025. This is a slight decline from the
11.1% growth seen in 2023. Consumers will prioritise essential and durable food options due to supply challenges, with fresh and
preserved fruit being the weakest performing sub-segment, growing by an average of 8.2% y-o-y, while all other food segments
are projected to show industry average growth rates.
• Over the medium term (2024-2028), we forecast steady growth in food spending at an average annual rate of 7-9% to reach
around PKR14trn (USD38bn) by 2028. This will be driven by rising incomes and demand for convenience foods. Elevated
inflation and limited forex reserves pose downside risks to this outlook. Dairy will remain the largest expenditure category,
growing to PKR4.2trn (USD11.4bn) by 2028, up from PKR3.1trn (USD11.1bn) in 2024, aided by increased household
refrigeration. Spending on rice, bread and cereals is expected to rise to PKR2.3trn (USD7.8bn) by 2028 due to population growth
and urbanisation.
• Meat and poultry consumption will grow at an annual rate of 8.4%, reaching PKR1.5trn (USD4.1bn) by 2028. This growth will be
supported by rising incomes and government investment in the halal industry. Oils and fats spending is forecast to grow to
PKR1.6trn (USD4.2bn) by 2028, up from PKR1.2trn (USD4.1bn) in 2024. This growth will be driven by health awareness and
increased home cooking.

Structural Trends

Food Spending Outlook For 2024 & 2025

We forecast that spending on food in Pakistan will grow by 10.1% y-o-y in 2024 and 9.2% in 2025, a slight decline from the 11.1%
growth seen in 2023. We expect consumers to continue to prioritise more essential and durable food options, as households
struggle to access sufficient food supply. Over the next two years, fresh and preserved fruit will be the weakest performing sub-
segment for food spending, growing by a forecast average of 8.2% y-o-y. All other food segments are expected to show industry
average growth rates.

[Link]/bmi 59

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Food Sales Set For Steady Growth

Pakistan - Food Sales, PKRmn, % y-o-y (2021-2028)

e/f = BMI estimate/forecast. Source: National statistics, BMI

Medium-Term Trends

Over the medium term, we forecast steady growth in food spending, at an average annual rate of between 7% and 9%, taking food
spending up to around PKR14trn (USD38bn) by 2028. Growth will be driven by rising incomes and an increased demand for
convenience or packaged foods. Elevated inflation, limited forex reserves to cover food imports and a persistent balance of
payments crisis will present downside risks to our outlook.

Dairy represents the largest share of food expenditure, with total spending on dairy and dairy products reaching PKR4.2trn
(USD11.4bn) by 2028, up from PKR3.1trn (USD11.1bn) in 2024. The market has historically been held back by a lack of household
refrigeration. However, rising levels of disposable incomes will allow a larger number of households to afford resources for cold
storage.

The rice, bread and cereals category makes up a significant part of the national diet, accounting for PKR2.1trn (USD7.6bn) in 2024.
We expect spending in this category to increase to PKR2.3trn (USD7.8bn) by 2028. This growth is driven by a combination of
population growth and rising incomes, which will boost demand for staple foods. Urbanisation trends are likely to influence
consumer preferences towards more packaged and ready-to-eat cereal products.

Meat and poultry consumption will be one of the fastest growing segments over our medium term, with average annual growth of
8.4%. This will take spending from PKR1.1bn (USD3.9bn) in 2024 to PKR1.5trn (USD4.1bn) by 2028. Meat is a staple in most
Pakistani consumer diets and forms an important part of traditional meals such as kebab dishes. With the quality of supply a
concern in the meat and poultry market, rising incomes and government investment in the development of the domestic halal
industry are increasing the popularity of branded products that offer a higher quality standard.

Oils and fats is another key category in the Pakistani food market. It is expected to grow to PKR1.6trn (USD4.2bn) by 2028, up from
PKR1.2trn (USD4.1bn) in 2024. Oils and fats are an essential accompaniment to most meals prepared in Pakistani cuisine, including
Seekh kebab and Aloo gosht. The increasing awareness of the health benefits of certain oils, such as olive and sunflower oil, is
expected to further drive market growth. The rise in home cooking and food delivery services will also contribute to the higher
consumption of oils and fats.

[Link]/bmi 60

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Food Sales (P
(Pakistan
akistan 2021-2028)
Indicator 2021e 2022e 2023e 2024f 2025f 2026f 2027f 2028f
Food, sales, PKRmn 7,539,961.2 8,446,775.4 9,382,400.2 10,333,206.4 11,283,547.7 12,215,968.5 13,111,705.7 13,951,433.2
Food, sales, PKRmn,
6.9 12.0 11.1 10.1 9.2 8.3 7.3 6.4
% gr
groowth yy-o-y
-o-y
Br
Bread,
ead, ric
ricee and
cer
ereals,
eals, sales, 1,564,131.9 1,749,872.7 1,941,518.0 2,136,275.5 2,330,939.8 2,521,934.6 2,705,416.4 2,877,425.9
PKRmn
Br
Bread,
ead, ric
ricee and
cer
ereals,
eals, sales,
6.9 11.9 11.0 10.0 9.1 8.2 7.3 6.4
PKRmn, % gr gro
owth
y-o-y
Bak
Baked
ed goods, sales,
29,900.4 33,442.4 37,096.9 40,810.8 44,522.9 48,165.0 51,663.9 54,944.0
PKRmn
Bak
Baked
ed goods, sales,
PKRmn, % gr
gro
owth 6.8 11.8 10.9 10.0 9.1 8.2 7.3 6.3
y-o-y
Meat and PPoultr
oultryy,
798,693.8 896,199.3 996,800.7 1,099,032.9 1,201,213.9 1,301,467.3 1,397,775.8 1,488,061.7
sales, PKRmn
Meat and P Poultr
oultryy,
sales, PKRmn, % 7.1 12.2 11.2 10.3 9.3 8.3 7.4 6.5
gr
groowth yy-o-y
-o-y
Dair
Dairyy, sales, PKRmn 2,258,303.8 2,532,312.5 2,815,023.4 3,102,319.0 3,389,472.1 3,671,209.0 3,941,860.6 4,195,587.9
Dair
Dairyy, sales, PKRmn,
7.0 12.1 11.2 10.2 9.3 8.3 7.4 6.4
% gr
groowth yy-o-y
-o-y
Oils and FFats,
ats, sales,
849,586.1 951,229.3 1,056,102.6 1,162,678.2 1,269,202.0 1,373,717.5 1,474,121.3 1,568,247.1
PKRmn
Oils and FFats,
ats, sales,
PKRmn, % gr groowth 6.9 12.0 11.0 10.1 9.2 8.2 7.3 6.4
y-o-y
Fr
Fresh
esh and
pr
preser
eservved fruit, 227,204.4 251,503.1 276,578.1 302,063.2 327,538.3 352,534.8 376,549.2 399,063.0
sales, PKRmn
Fr
Fresh
esh and
pr
preser
eservved fruit,
6.1 10.7 10.0 9.2 8.4 7.6 6.8 6.0
sales, PKRmn, %
gr
groowth yy-o-y
-o-y
Fr
Fresh
esh vvegetables,
egetables,
975,134.6 1,092,949.8 1,214,507.5 1,338,036.9 1,461,505.5 1,582,645.6 1,699,019.4 1,808,116.4
sales, PKRmn
Fr
Fresh
esh vvegetables,
egetables,
sales, PKRmn, % 7.0 12.1 11.1 10.2 9.2 8.3 7.4 6.4
gr
groowth yy-o-y
-o-y
Sugar and sugar
pr
products,
oducts, sales, 555,941.1 623,577.6 693,361.9 764,277.8 835,158.3 904,701.8 971,508.9 1,034,138.4
PKRmn
Sugar and sugar 7.0 12.2 11.2 10.2 9.3 8.3 7.4 6.4

[Link]/bmi 61

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Indicator 2021e 2022e 2023e 2024f 2025f 2026f 2027f 2028f

pr
products,
oducts, sales,
PKRmn, % gr gro
owth
y-o-y
Other ffood
ood
pr
products,
oducts, sales, 281,065.1 315,688.6 351,411.0 387,712.2 423,994.9 459,593.0 493,790.2 525,848.8
PKRmn
Other ffood
ood
pr
products,
oducts, sales,
7.1 12.3 11.3 10.3 9.4 8.4 7.4 6.5
PKRmn, % gr gro
owth
y-o-y
e/f = BMI estimate/forecast. Source: National statistics, BMI

[Link]/bmi 62

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Regional Overview
Five Key Themes For Asia Agribusiness
Key View

• We have identified several broad themes that we believe we will shape medium-term outcomes in Asia’s agricultural sector. In
the short term, the relaxation of export restrictions in India in late September 2024 and the end of the 2023-2024 El Niño in April
2024 are expected to loosen the Asian rice market, with the international rice price level expected to have softened through
end-2024. In our view, La Niña poses upside risks to regional rice production, in India and South East Asia in particular, while its
expected weak strength should limit the risk of excess rainfall and flooding.
• In the medium term, we expect agricultural sector policies in Asia to focus on mitigating food security risks, following recent
turmoil in international commodities markets that began with the Covid pandemic. These policies will align with traditional
sector policies, such as stimulating agricultural production growth and raising rural incomes and livelihoods. In high-income
markets in Asia, such as Japan and South Korea, efforts to cushion the impact of tight agricultural labour supplies and falling
demand for staple crops will also be pursued.
• We have observed a deceleration in agricultural productivity growth in Asia over the past two decades. Reversing this trend is
crucial for boosting agricultural production, particularly in markets with limited unused land and high rates of input use, such as
fertiliser. Achieving this will require increased investment in research and development, agricultural extension services, and
technology. Climate change poses a structural headwind to productivity growth.
• Biofuel production is expected to remain concentrated in a select pool of regional markets led by India, Indonesia and Malaysia
for the foreseeable future. Its impact on feedstock crop markets in Asia will continue to rise in the medium term, which could
result in a reduction or a stagnation in export supplies of commodities such as palm oil and sugar, with implications for
international prices. In August 2024, Indonesia’s president-elect, Prabowo Subianto, announced his desire to implement a 50%
biodiesel blending rate at the end of 2025, up from the current mandate of 35%.

1. Global Market Outlook: Ample Supplies To Weigh On Grains, But Unfavourable Weather Poses Upside Risks

In 2025, we anticipate a modest rise in the average annual prices for second-month CBOT-listed corn and wheat. Corn prices are
projected to increase by 3.4% y-o-y, while wheat prices are expected to grow by 2.5% y-o-y. Despite these increases, we believe that
ample global supplies will prevent significant price surges. For wheat, though we foresee a second consecutive production deficit of
1.6mn tonnes in the 2024/25 season (down from an 8.1mn tonnes deficit in 2023/24), the USDA forecasts beginning stocks at
265.2mn tonnes. This level, the lowest since the 2017/18 season, still ensures total wheat supplies of 1.1bn tonnes, indicating
sufficient global supplies for 2025, given our consumption forecast of 798.4mn tonnes.

Reduced demand from Mainland China is expected to be a bearish factor across the grains complex in 2025. The USDA forecasts a
15.7% year-on-year decrease in China's wheat import demand and a 31.6% reduction in corn imports for the 2024/25 season.
Additionally, we expect a decline in China's soybean import demand, leading to our projection that soybean prices will average
USc1,090/bu in 2025, decreasing by 2.7% y-o-y. China's increased purchasing in 2024, particularly prior to the US election, has
strengthened its domestic stocks. This accumulation, potentially as a precaution against trade war uncertainties under a Trump
presidency, is expected to reduce China's soybean import demand regardless of trade war developments. Furthermore, we
anticipate significant year-on-year production increases from major global producers like the US and Brazil. The US is expected to
increase its output by 11.5mn tonnes, or 10.1% year-on-year, while Brazil is set for a record harvest of 169.0mn tonnes, up by
17.0mn tonnes, or 11.2% y-o-y, for the 2024/2025 season. These increases in production will ensure ample global supplies, further
contributing to the bearish outlook for soybean prices.

[Link]/bmi 63

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Markets Pulled Back Losses In Q3 2024...

Grain Price Index (Dec-23 = 100) (2024)

Note: CBOT-listed second-month futures contracts. Source: Haver, BMI

Given that USDA projections as of September point to Russia accounting for 22.2% of world wheat exports in 2024/25, we highlight
the concentration of wheat market risk in the Black Sea region. With hostilities in the Middle East on the rise, we also flag the upside
risk to grain prices that a sustained increase in oil prices, on the back of increased geopolitical risk premia, would pose. An increase
in oil prices would feed through into elevated agricultural production costs, while higher transport fuel costs would also stimulate
increased demand for biofuels, to the benefit of agricultural feedstock prices. Meanwhile, we are of the view that the anticipated
onset of a La Niña event in Q4 2024 poses limited risks to grains markets due to its projected weak strength, which could see La
Niña weather conditions fail to materialise in several regions. We acknowledge a downside La Niña risk to rice prices, which we also
expect to face headwinds due to the relaxation of some rice export restrictions in India at the end of September.

Related Research

• La Niña: Implications For Global Agricultural Commodity Prices, September 2024

• La Niña: Implications For Global Agricultural Production, September 2024
• Mid-Year Update: Agribusiness Key Themes For 2024, July 2024

2. Asia Rice Market: Easing Of Indian Export Restrictions, End Of El Niño Marks Turning Point

On September 27 2024, the Indian government announced its decision to repeal a ban on non-basmati white rice exports and to
reduce a duty on parboiled rice exports from 20% to 10%. The introduction of these export restrictions in July-August 2023 resulted
in a sharp increase in international rice prices, with the FAO All Rice Price Index (FARPI) rising by almost 10% m-o-m in August 2023
to its highest level since August 2008. In addition, the continuation of the export restrictions also raised the level of price support in
international markets. FARPI averaged 137.7 points in January-July 2024 compared to 125.8 points in the same period in 2023.
Between September 25 and October 2, export quotations for Thai 5% broken white rice, for example, fell from USD570 per tonne to
USD509 per tonne, their lowest level since the start of June 2023, prior to the introduction of India’s export restrictions.

Furthermore, the 2023-2024 El Niño, which spanned May 2023 to April 2024, was one of the five most severe El Niño events on
record. It resulted in unfavourable rice cultivation conditions in South East Asia. Per USDA estimates, rice production in the region

[Link]/bmi 64

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

fell from 117mn tonnes in 2022/23 to 115mn tonnes 2023/24, while import demand in several major regional importers, including
Indonesia and the Philippines, also rose on elevated rates of domestic food price inflation. As of its latest available projection,
published on September 12, the US Climate Prediction Center has assigned a likelihood in excess of 50% to active La Niña
conditions being present between October 2023 and February 2024, which, in our view, poses upside risks to regional rice
production. The projected weak-to-mild strength of the anticipated La Niña should also limit the risks of excess rainfall and floods.

Immediate Price Reductions In Wake Of India's Relaxation Of Trade Restrictions

Thailand - White Rice Export Quotations (USD per tonne)

Source: FAO, BMI

A reduction in rice prices will ease rice-driven food price inflation pressures in several Asian markets. In the Philippines, for example,
rice price inflation peaked at almost 25% in March 2024 before a reduction in rice import duties the following June contributed to
rice price inflation printing at under 6% in September. Nonetheless, this remains elevated when compared with pre-2023 levels. For
the Philippines, a reduction in the rate of rice price inflation could have significant macroeconomic implications due to the
weighting of 8.9% allocated to rice prices in the domestic CPI basket.

While other rice importers in the region, including Indonesia and Malaysia, also saw an increase in imported price pressures on
account of elevated international rice prices, an increase in foreign demand also contributed to domestic wholesale rice price
inflation in exporting markets. In Thailand and Vietnam (Bac Lieu), wholesale prices for 5% broken white rice, a natural substitute for
non-basmati white rice from India, rose by 17.8% and 22.4% respectively, in August 2023. Average prices in Thailand were 27.9%
higher in H12024 than in H12023 while those in Vietnam were 26.7% higher, an indication of the price support resulting from
export restrictions in addition to the immediate price impact of India’s July-August 2023 announcements.

However, market-specific factors will mitigate the impact of a reduction in international rice prices on domestic rice price inflation. In
Japan, for example, a confluence of factors – including a poor domestic harvest in 2023/24, an earlier drawdown of private
inventories, and natural disaster-driven stockpiling – have led to a sharp tightening in the domestic rice market, with the result that
rice price inflation printed at 28.3% in August 2024, its highest level since the mid-1970s. In addition, Japan maintains prohibitive
out-of-quota rice import tariffs in order to safeguard domestic farmgate prices, which, in tandem with strict socio-cultural
preferences with respect to which varieties of rice consumers demand, will serve to limit the easing effect of falling international rice
prices on domestic rice prices.

[Link]/bmi 65

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Domestic Factors Underpin Severe Rice Price Inflation In Japan

Japan - Rice Price Inflation (%, y-o-y)

Source: Haver, BMI

Broadly speaking, the global rice market is largely synonymous with the Asian rice market. In the 10 seasons up to and including
2022/23, USDA data indicate that East, South, and Southeast Asia accounted for a combined 89.3% of world rice production, a
combined 84.5% of world rice consumption, and a combined 82.4% of world rice exports. However, the shares accounted for by
each region in these three aggregates does differ somewhat. In terms of both world rice production and world rice consumption,
both East and South Asia account for around 30%-35% of the total while South East Asia accounts for around 20%-25%. In contrast,
South Asia and South East Asia each account for around 40% of world rice exports, while East Asia holds a minimal share of under
5%. As noted above, South East Asia also contains several large rice importers, which underpinned the region’s 13.6% share in world
rice imports between 2013/14 and 2022/23. East Asia (13.5%) and South Asia (5.0%) maintain a smaller profile in world rice
imports, in part due to the fact that both Mainland China and India are self-sufficient with respect to rice production, which limits the
need for imports (notwithstanding imports of specific rice varieties not cultivated on a domestic basis).

The dominance of Asia in the world rice market is not a surprise. Rice has been a staple food item in Asia for millennia and is thus
embedded in socio-cultural practices and norm while tropical and sub-tropical climates, with warm temperatures and abundant
rainfall, are ideal for rice cultivation, which remains a labour-intensive process and thus suited to the distribution of economic factors
of production in Asia. In modern times, rice's importance to domestic food prices, food security, rural and low-income livelihoods,
and export revenue has led to active government intervention in the sector. This intervention has often been necessary to balance
competing aims. In India, for example, the tension between maximising export revenue at a time of elevated international prices and
ensuring domestic rice price stability in 2023 contributed to the July-August 2023 introduction of export restrictions.

Related Research

• Rice Price Forecast: International Rice Prices Tumble As India Eases Export Restrictions, October 2024
• La Niña: Implications For Agribusiness Markets In South East Asia, September 2024
• Japan: After Poor Harvest In 2023 And Robust Consumption, Rice Market Expected To Remain Tight In 2024/2025, August 2024

[Link]/bmi 66

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

3. Agricultural Policies In Asia Reflect Sector Development Goals, Food Security Concerns

Given prevalent levels of economic development between major world regions, agriculture and related agricultural activities retain a
more significant economic role in Asia than in the Americas or Europe. For example, agriculture remains a major source of jobs
across Asia. Between 2018 and 2022, according to World Bank data, the sector accounted for 41.7% of total employment in South
Asia and 26.2% of total employment in East Asia and the Pacific (excluding high income markets). However, there is also
considerable differentiation within Asia, which reflects differences in economic development. In the same period, agriculture
accounted for 3.2% of Japanese workers and 5.3% of South Korean workers as well as 47.4% of workers in Myanmar and 66.2% of
workers in Laos.

Individual food products and agricultural soft commodities also account for a high share of total export revenue in several markets
in Asia. For example, palm oil was Indonesia’s second-most valuable export product and Malaysia’s fourth-most valuable export
product in 2023, per Trade Map data. Compared to a world average between 2019 and 2023 of 8.3%, agricultural products
accounted for 51.7% of total exports in Nepal, 23.6% in Myanmar, 23.2% in Sri Lanka, 19.9% in Pakistan, 18.5% in Indonesia, 16.7%
in Laos, 14.7% in Thailand, 10.7% in India, 9.1% in Malaysia and 8.7% in the Philippines. However, several markets in Asia sit well
below the world average. In the same period, agricultural exports accounted for 7.8% of total export revenue in Cambodia, 6.6% in
Vietnam, 2.5% in China, 1.4% in South Korea, 1.4% in Bangladesh and 1.0% in Japan. In these markets, agricultural imports are often
of greater significance – and of greater interest to lawmakers – given the reliance of domestic food security on consistent inflows of
food products from abroad. Indeed, in Japan, for example, the process and pace of economic development that have seen the
shares in the labour force and total export revenue attributed to the agricultural sector have in so doing also underpinned an
increased reliance on imported agricultural products.

Export Profile Of Agricultural Sector Differs Within Asia

Select Asia Markets - Agricultural Exports, % of Total Exports (2019-2023)

Note: May include territories, special administrative regions, provinces and autonomous regions. Source: Trade Map, BMI

Domestic agricultural production also serves as critical component of food security in low- and middle-income economies in Asia,
furthering ensuring the interest of lawmakers and the development of support policies. Between 2019 and 2023, the share of the
world population that faced moderate-to-severe food insecurity stood at 28.1% compared to 24.4% in Asia. Within Asia, however,
rates of moderate-to-severe food insecurity exceeded the world average in both Western Asia, at 37.3%, and Southern Asia, at
40.3%. Despite a pandemic-era uptick, rates of moderate-to-severe food insecurity in Eastern Asia, at 6.8%, and South East Asia, at

[Link]/bmi 67

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

16.2%, remained below the world average. If severe food insecurity is considered in isolation, the same pattern emerges. Between
2019 and 2023, the world average stood at 10.5%, below that recorded in Western Asia, 12.7%, and Southern Asia, 18.7%, but
higher than that recorded in Eastern Asia, 1.3%, and South East Asia, 2.4%. In terms of diets, the prevalence of undernourishment in
Southern Asia in 2021-2023, 14.2%, exceeded the world average, 9.1%, in the same period, with rates of 13.7% in India and 20.7% in
Pakistan, while the comparable rate in South East Asia, 6.0%, was below the world average. Given these statistics, efforts to stimulate
domestic agricultural production growth and to stabilise agricultural production volumes and incomes in Asia are commonplace.

In addition, initiatives to increase rural incomes, one of the major determinants of which is the performance of the domestic
agricultural sector, also lean on policies intended to increase agricultural productivity. Overall, sector policies are multifaceted and
varied – as illustrated with the examples of China and India below – but often reflect the same broad themes including, but not
limited to, access to agricultural inputs, such as fertilisers and seeds, and finance; the provision of technical assistance; investment in
collection, storage, and distribution capacities; investment in value-adding processing facilities; and, the expansion of irrigation
networks and the promotion of sustainable water management practices. One obstacle to agricultural production growth in Asia
that amplifies the significance of productivity growth is the constraint on land expansion in the region. Between 2018 and 2022,
average cropland per capita at the world level amount to 0.20 hectares whereas it stood at 0.12 hectares in Asia and just 0.09
hectares in China.

International Market Price Risks Also Differ

Select Asia Markets - Net Agricultural Trade Position, USD per capita (2023)

Note: May include territories, special administrative regions, provinces and autonomous regions. Source: Trade Map, BMI

In both China and India, two of the world’s largest agricultural sectors, food-security-minded policies sit alongside and within
broader sector development aims.

Mainland China: The political importance of domestic agricultural production growth and food security in China has risen due to
multiple shocks in recent seasons, including the US-China trade tensions, a mass outbreak of African swine fever (ASF) in the
domestic swine herd, the global pandemic, an extended La Niña in 2020-2023 and the Russia-Ukraine war. At the end of 2023, for
instance, the Standing Committee of China’s National People’s Congress (NPC) passed a food security law, which took effect in
mid-2024, that stated the need to ‘ensure absolute security in staple foods and basic self-sufficiency in grains’. One area of
perceived vulnerability that has received attention has been China’s reliance on imported feed grains and soybean – and on its

[Link]/bmi 68

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

reliance on US exports to fill domestic import demand in particular. In consequence, China has pursued trade diversification,
opening its domestic market to Brazilian corn exporters in 2022 and to Argentinian wheat exporters in 2023. In addition, China’s
National Crop Variety Registration Committee, while maintaining a cautious approach to the commercialisation of GM crops,
released an inaugural list of approved GM corn and soybean varieties in October 2023, which has since been followed with further
approvals. Nonetheless, the cultivation of GM crops remains limited to small areas of state-monitored cropland. China has also
implemented measures intended to reduce the soy content of animal feed and to support domestic soybean producers.

Food Security Policies Targeted At Supplies Of Staple Food Items

China (Mainland) & India - Agricultural Crop Self-Sufficiency, % (2018/19-2022/23 ave)

Note: May include territories, special administrative regions, provinces and autonomous regions. Source: USDA, BMI

India: The annual summer monsoon rainfall in India, which provides 70%-90% of total annual rainfall, remains a critical variable in
the season-to-season performance of the Indian agricultural sector, with natural fluctuations in rainfall, both between seasons as
well as within single seasons, reflected in sometimes sizeable fluctuations in crop production. India’s dependence on the monsoon
is amplified on account of a domestic irrigation network that remains uneven, resulting in a high share of total domestic planted
area being rainfed, and due to unsustainable water management and use practices. A desire to stabilise cropland area is one factor
behind the Indian government’s minimum support price (MSP) scheme, along with a desire to support rural incomes. In 2024, India
ranked 105th in the Global Hunger Index (GHI), an annual peer-review assessment published by Welthungerhilfe and Concern
Worldwide, both NGOs, with improving food supplies and access to nourishment a major focus of government policies. According to
the 2024 GHI, 13.7% of the Indian population was undernourished while 35.5% of children under the age of five were stunted and
18.7% of children under the age of five were wasted. The Indian government has revealed a consistent desire to increase domestic
agricultural production and to reduce challenges with respect to access to food, which is borne out in food distribution schemes,
including the Public Distribution System (PDS), the National Food Security Act of 2013, and the pandemic-era Pradhan Mantri Garib
Kalyan Anna Yojana (PMGKAY) scheme, which was extended until the end of 2028. With respect to the broader impact of the
agricultural sector on domestic livelihoods, two fifths of the Indian labour force are employed in agriculture, which to a certain
extent, however, also points to its low productivity. In terms of farmer support, major policies include the Minimum Support Price
(MSP) procurement scheme, the Nutrient Based Subsidy fertiliser scheme, the Pradhan Mantri Fasal Bima Yojana (PMFBY) crop
insurance scheme, the Pradhan Mantri Kisan Samman Nidhi (PM-KISAN) direct income support scheme, and the Pradhan Mantri
Krishi Sinchai Yojana (PMKSY) productivity scheme.

[Link]/bmi 69

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Related Research

La Niña: Implications For Agribusiness Markets In Mainland China, September 2024

La Niña: Implications For Agribusiness Markets In India, September 2024

Food Security in Japan (I): Short-Term Stresses And Long-Term Strains, May 2024

4. Productivity Growth Has Started To Slow And Climate Change Poses Further Headwinds

In broad terms, agricultural production can be increased via two different methods. On the one hand, farmers can increase their
utilisation of agricultural inputs, such as land, fertiliser, and irrigation networks. On the other hand, farmers can leverage an existing
level of inputs in a more effective manner, which, in a non-static setting, implies that the rate of agricultural production growth
exceeds the rate of agricultural input utilisation growth. The latter measurement is referred to as total factor productivity (TFP) as it
captures all single factor productivity metrics, including crop yield (output per unit of land) and value-added per worker (output per
unit of labour). As time progresses, the reserves of unused inputs become depleted, such as arable land, and so TFP growth
becomes a more important determinant of structural agricultural production growth. In its turn, TFP growth is the result of the
development and commercialisation of new technologies, where technologies are taken to include not just machineries and
equipment but also agronomic practices, management techniques, and biological advances. At the global level, the importance of
agricultural TFP growth to agricultural production growth has risen since the 1960s. The USDA’s Economic Research Service (ERS)
has estimated that agricultural TFP grew at an average rate of under 0.6% per annum compared to average agricultural output
growth of 2.3% per annum in the 1970s, of 1.7% per annum compared to 2.5% per annum in the 1990s, and of 1.1% per annum
compared to 1.9% per annum in the 2010s. As these estimates also make clear, both headline agricultural production growth and
agricultural TFP growth slowed in the 2010s. The ERS have identified several factors that could underpin this deceleration in
agricultural TFP growth including climate change, insufficient public and private investment in agricultural research and
development, incomplete technological diffusion, trade barriers, and conflict events.

Productivity Growth Has Increasingly Driven Headline Output Growth

World - Agricultural Output Growth Decomposition (%, CAGR)

Source: USDA ERS, BMI

[Link]/bmi 70

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Asia has exhibited higher average rates of growth in terms of both agricultural TFP and total agricultural output than the world
average in each decade since the 1960s, during which period TFP growth exceeded the world average by 0.6% per annum and
output growth by 0.7% per annum. The Green Revolution, which began in the 1960s and saw the widespread adoption of high-
yielding crop varieties, synthetic fertilisers, and advanced irrigation techniques, fuelled agricultural productivity growth in Asia.
However, both TFP and output growth rates in Asia have declined over the past two decades, as is the case for the world as a whole.
For Asia in particular, the deceleration has been linked to the diminishing returns still available from Green Revolution technologies.
Between the 1990s and the 2010s, the average rate of agricultural TFP growth in Asia fell from 2.9% per annum to 1.8% per annum
while the average rate of agricultural output growth fell from 4.3% per annum to 2.2% per annum. On a sub-regional level, however,
South Asia – per the USDA’s classification composed of Bangladesh, Bhutan, India, Nepal, Pakistan, and Sri Lanka – achieved higher
average growth rates across both metrics in the 2010s than in the 1990s, 2.2% per annum compared to 0.5% per annum in the
case of TFP, and 3.2% per annum compared to 2.8% per annum in the case of output. In relation to India in particular, elevated
growth rates are at least in part indicative of a low base, with signs of a still unproductive sector visible. In 2022, for example, value
added per agricultural worker in India was around USD2,115 in constant 2015 US dollars whereas it was close to USD3,080 in Sri
Lanka and over USD3,100 in Pakistan. Research has identified public investment in irrigation infrastructure as one of the core
drivers of agricultural TFP growth in India over the past three decades, in groundwater irrigation supplied from wells more so that
from in surface-water irrigation supplied from canals. A second important TFP growth driver has been public agricultural research
and higher education enrolment in related fields.

Production Growth In Asia Has Decelerated Over The Past Two Decades
Agricultural Output Growth (%, CAGR)

Source: USDA ERS, BMI

In the 2010s, average rice yield growth slowed in both South and Southeast Asia, declining from 1.8% to 1.7% in the case of the
former and from 0.8% per annum to 0.5% in the case of the latter, whereas it accelerated from 0.4% per annum to 0.7% per annum
in East Asia. In the medium term, climate change poses a structural headwind to rice production. In the Yangtze River and Mekong
River basins, for example, higher temperatures, altered precipitation patterns, and more frequent extreme weather events represent
threats to rice cultivation, as do altered river flows and an increased likelihood of soil salinisation. In India, climate change poses a
similar series of threats to rice production with an expected shift in monsoon rainfall patterns a particular concern. Climate change
adaptation methods available to rice cultivators in Asia include planting stress- and salt-tolerant rice varieties, improved soil and
water management practices, and crop diversification. At the same time, rice cultivation is a significant source of global methane
emissions and so farmers could be encouraged or required to adopt climate change mitigation methods such as the more efficient

[Link]/bmi 71

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

use of fertiliser and the alternate wet and drying (AWD) technique. The 2010s also saw a mixed performance for wheat cultivation in
Asia. Average yield growth accelerated from 0.5% per annum to 2.0% per annum in South Asia, decelerated from 2.4% per annum
to 1.9% per annum in East Asia, and reversed course from 4.8% per annum to minus 2.7% per annum in Southeast Asia. In South
Asia, the improved wheat yield performance in the 2010s was in the main the result of significant improvements in India in
2017-2019, which reflected the 2016 introduction of the Pradhan Mantri Fasal Bima Yojana (PMFBY) crop insurance scheme,
successive increases in the minimum support price (MSP) for wheat, which rose from INR1,450 per quintal in 2015/16 to INR1,840
per quintal in 2019/20, and favourable weather conditions.

Related Research

Asia Fertiliser Outlook: Weak Farm Profitability To Pressure Application, October 2024

Costs Of Climate Change Will Fall On South Asia, Africa, August 2024

Global Nitrogen-Based Fertiliser Outlook: Application Growth To Slow Through The Long Term, January 2024

5. Ambitious Biofuel Policies Will Reshape Demand For Feedstock Crops

The International Energy Agency (IEA) expects that world biofuel demand will increase by 38bn litres in 2023-2028, an increase of
close to 30% compared to 2017-2022. According to the IEA, most new biofuel demand will come from emerging markets (EMs)
with Brazil, India, Indonesia, and Malaysia, where robust biofuel policies are paired with rising transport fuel demand and ample
feedstock potential as well as high oil import dependence, identified as leading this trend. With respect to individual biofuel classes,
renewable diesel and ethanol are set to account for two thirds of total biofuel demand growth with EMs expected to account for the
bulk of new ethanol and biodiesel consumption. In terms of individual EMs, Brazil and India are expected to account for the bulk of
total ethanol demand growth, which is estimated at 13bn litres in 2023-2028, while Brazil and Indonesia are expected to account for
most of total biodiesel demand growth, which is estimated at 8.0bn litres in 2023-2028. However, the IEA also believes that biofuels
will retain a marked price premium to traditional transport fuels in the medium term, which is reflected in the extension of direct
biofuel subsidies in India, Indonesia, and Malaysia. Feedstock prices will also underpin the cost of biofuels in these three markets,
which are, in the main, corn and sugar in India and palm oil in Indonesia and Malaysia. Meanwhile, the IEA has identified Japan as the
principal source of sustainable aviation fuel (SAF) production and use growth outside Europe and the US.

[Link]/bmi 72

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Recent Biodiesel Production Growth In Asia Has Been Palm-Based

Asia - Biodiesel Production (PJ)

Source: FAO, BMI

Increased biofuel production and consumption in Asia, which will be supported via ambitious blending mandates, will require
increased supplies of feedstock crops, or an increased diversion of feedstock crops to domestic biofuel production at the expense
of human-use consumption and the export market. In June 2022, for example, India introduced sugar export restrictions in order to
ensure the feedstock requirements of the domestic ethanol sector could be met, following the 2021 decision to bring forward
India’s 20% ethanol blending target from 2030 to 2025. Between 2010/11 and 2020/21, the share of palm oil production in
Indonesia diverted to industrial use rose from 7.6% to 21.1% while in Malaysia the share increased from 8.6% to 13.5%. The USDA
forecasts that these shares will increase to 29.3% and 15.2%, respectively, in 2024/25, while the IEA expects (per its core scenario)
these shares to rise to 30% at the end of 2023-2028 period. Indonesia completed the nationwide rollout of B35 (ie, 35% biodiesel)
fuel in 2023. In August 2024, Indonesia’s president-elect, Prabowo Subianto, revealed his intention to implement a 50% palm oil-
based biodiesel blending mandate by 2025, following the introduction of a 40% mandate at the start of 2025. Malaysia failed to
achieve the full nationwide rollout of its B20 mandate in 2023 but has maintained a B30 mandate for 2025. Overall, the increased
diversion of sugar to ethanol production in India and of palm oil to biodiesel production in Indonesia and Malaysia – all of whom are
major exporters of these crops – will reduce world export supplies, notwithstanding the potential for output growth to compensate
for increased diversion, and in turn stimulate upward price pressures in the world market. In the case of Indonesia, the use of export
levies on palm oil exports to support domestic biodiesel use could compound this price impact insofar as increased biodiesel use
will require the extension of a greater value of subsidies which would have to be raised from a smaller volume of palm oil exports.

[Link]/bmi 73

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Impact Of Feedstock Use On Consumption Patterns Will Continue To Grow

Indonesia, Malaysia - Palm Oil Industrial Use (%, Palm Oil Exports)

e/f = USDA estimate/forecast. Source: USDA, BMI

In China, the domestic ethanol sector has been first and foremost a tool of domestic corn stock management rather than a driver of
low-carbon and transport policies. The USDA estimates that total ethanol consumption increased to almost 3.9bn litres in 2023, up
from 3.8bn litres in 2022, while the Chinese ethanol blend rate eased from 1.9% to 1.8% in the same period. In 2020, the Chinese
government suspended a domestic E10 mandate that had been due to take effect in 2022 in view of low corn inventories and
limited domestic production capacities. In 2023, the utilisation rate across the entire domestic ethanol production fleet was a shade
under 50%. For the E10 mandate to have been reached in 2023, a further 17.5bn litres of ethanol would have been required which
in turn would have required around 35mn-40mn tonnes of corn, equivalent to 12-14% of total Chinese corn production. Given
China’s increased focus on domestic food security, it does not seem probable that the E10 mandate will be resurrected in the
foreseeable future. In its 2023 report on China’s biofuel sector, the USDA concluded that there ‘is a common understanding that
E10 expansion [in China] has been halted’. However, China’s nascent SAF sector has attracted interest – and, more significantly,
investment – since 2023. However, SAF is at present produced using used cooking oil (UCO), also known as ‘gutter oil’ in China,
rather than a direct agricultural feedstock. Due to increased renewable diesel demand in the US, China’s exports of UCO have
increased. Chinese production of biomass-based diesel (BBD) has risen in recent years, rising from 0.9bn litres in 2019 to an
estimated 3.3bn litres in 2023, driven for the most part by export potential. However, the EU launched an anti-dumping
investigation into China’s biodiesel exports in December 2023, which represents a potential headwind to export growth. In March
2024, China’s National Energy Administration (NEA) announced the launch of 22 BBD pilot projects designed to increase the
promotion and application of BBD.

Related Research

• Palm Oil Price Forecast: Mounting Headwinds Set To Shape Market Development Through End-2024 And Into 2025, August
2024
• Challenges And Implications Of Biofuel Adoption In The Maritime Industry, August 2024
• Mainland China's Role In Global SAF Adoption: Navigating Feedstock Availability And Policy Impacts, June 2024

[Link]/bmi 74

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Competitive Landscape
Pakistan - Major Agricultur
Agricultural
al Companies
Company Sector Sub- Fiscal Market Revenue Net Capex Profit
Sector End-Year Cap (USDmn) Income (USDmn) Margin
(USDmn) (USDmn) (%)
Nestle P
Pakistan
akistan Consumer Packaged 12/2023 1,225.3 720.2 59.2 12.0 8.2
Staples Foods &
Meats
Frieslandcampina Engr
EngrooP
Pakistan
akistan Consumer Packaged 12/2023 na 359.8 5.4 9.4 1.5
Staples Foods &
Meats
National FFoods/P
oods/Pakistan
akistan Consumer Packaged 06/2024 154.6 305.7 6.8 12.8 2.2
Staples Foods &
Meats
Rafhan Maiz
Maizee Pr
Products
oducts Consumer Packaged 12/2023 266.9 235.0 24.8 8.7 10.6
Staples Foods &
Meats
Tandlianwala Sugar Mills Consumer Packaged 09/2023 27.9 161.9 5.8 1.2 3.6
Staples Foods &
Meats
JDW Sugar Mills Consumer Packaged 09/2024 177.3 466.6 48.6 23.0 10.4
Staples Foods &
Meats
Habib Sugar Mills Consumer Packaged 09/2024 34.4 73.7 7.0 0.1 9.5
Staples Foods &
Meats
Fauji FFoods
oods Consumer Packaged 12/2023 na 71.1 2.2 0.0 3.1
Staples Foods &
Meats
Mehr
Mehran
an Sugar Mills Consumer Packaged 09/2011 15.1 50.7 3.8 3.7 7.4
Staples Foods &
Meats
Al-Abbas Sugar Mills Consumer Packaged 09/2024 46.1 59.0 5.5 0.3 9.4
Staples Foods &
Meats
Thal Industries Consumer Packaged 09/2023 16.2 117.9 7.5 5.5 6.4
Staples Foods &
Meats
Punjab Oil Mills Consumer Packaged 06/2024 4.9 28.5 -0.1 0.4 -0.5
Staples Foods &
Meats

na = not available. Source: Bloomberg, BMI

[Link]/bmi 75

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Pakistan Demographic Outlook

Demographic analysis is a key pillar of our macroeconomic and industry forecasting model. The total population and demographic
profile of a market are key variables in consumer demand and are essential to understanding issues ranging from future population
trends to productivity growth and government spending requirements.

The accompanying charts detail the population pyramid for 2022, the change in the structure of the population between 2022 and
2050 and the total population between 1990 and 2050. The tables show indicators from all of these charts, in addition to key
metrics such as population ratios, the urban/rural split and life expectancy.

Population
Pakistan – Population, mn (1990-2050)

f = BMI forecast. Source: World Bank, UN, BMI

Population Pyramid
Pakistan – 2022 Male vs Female Population, '000 (LHC) & 2022 vs 2050 Population, '000 (RHC)

Source: World Bank, UN, BMI

[Link]/bmi 76

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Population Headline Indicator

Indicatorss (P
(Pakistan
akistan 1990-2025)
Indicator 1990 2000 2005 2010 2015 2020 2025f
Population, total, '000 115,414.1 154,369.9 174,372.1 194,454.5 210,969.3 227,196.7 249,948.9
Population, % yy-o-y
-o-y 3.12 2.18 2.28 1.30 1.75 1.93
Population, total, male, '000 59,844.2 79,746.1 89,942.0 99,987.5 107,983.7 114,815.6 125,928.3
Population, total, ffemale,
emale, '000 55,569.9 74,623.9 84,430.1 94,467.0 102,985.6 112,381.1 124,020.6
f = BMI forecast. Source: World Bank, UN, BMI

Key P
Population
opulation Ratios (P
(Pakistan
akistan 1990-2025)
Indicator 1990 2000 2005 2010 2015 2020 2025f
Activ
Activee population, total, '000 60,949.5 82,770.8 96,528.4 110,893.4 121,661.0 133,031.5 150,491.4
Activ
Activee population, % of total population 52.8 53.6 55.4 57.0 57.7 58.6 60.2
Dependent population, total, '000 54,464.6 71,599.1 77,843.7 83,561.1 89,308.3 94,165.2 99,457.5
Dependent rratio,
atio, % of total w
working
orking age 89.4 86.5 80.6 75.4 73.4 70.8 66.1
Youth population, total, '000 50,478.1 66,255.2 71,658.1 76,306.7 81,067.7 84,681.6 88,146.7
Youth population, % of total w
working
orking age 82.8 80.0 74.2 68.8 66.6 63.7 58.6
Pensionable population, '000 3,986.5 5,343.8 6,185.6 7,254.4 8,240.7 9,483.6 11,310.8
Pensionable population, % of total w
working
orking age 6.5 6.5 6.4 6.5 6.8 7.1 7.5
f = BMI forecast. Source: World Bank, UN, BMI

Urban/R
Urban/Rur
ural
al P
Population
opulation And Lif
Lifee Expectancy (P
(Pakistan
akistan 1990-2025)
Indicator 1990 2000 2005 2010 2015 2020 2025f
Urban population, '000 35,289.0 50,914.3 59,255.1 68,053.2 76,003.8 84,437.7 96,750.2
Urban population, % of total 30.6 33.0 34.0 35.0 36.0 37.2 38.7
Rur
ural
al population, '000 80,125.1 103,455.6 115,117.0 126,401.3 134,965.5 142,759.1 153,198.7
Rur
ural
al population, % of total 69.4 67.0 66.0 65.0 64.0 62.8 61.3
Lif
Lifee eexpectancy
xpectancy at bir
birth,
th, male, yyear
earss 59.0 61.2 61.2 62.3 63.5 63.9 65.3
Lif
Lifee eexpectancy
xpectancy at bir
birth,
th, ffemale,
emale, yyear
earss 61.4 63.1 64.0 66.9 68.2 68.8 70.1
Lif
Lifee eexpectancy
xpectancy at bir
birth,
th, av
aver
erage,
age, yyear
earss 60.1 62.1 62.5 64.4 65.7 66.3 67.6
f = BMI forecast. Source: World Bank, UN, BMI

[Link]/bmi 77

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Population B
Byy Age Gr
Group
oup (P
(Pakistan
akistan 1990-2025)
Indicator 1990 2000 2005 2010 2015 2020 2025f
Population, 0-4 yr
yrs,
s, total, '000 20,514.4 24,271.4 25,848.2 27,433.2 29,279.8 29,433.0 30,457.1
Population, 5-9 yr
yrs,
s, total, '000 16,662.8 22,208.5 23,734.0 25,292.2 26,754.2 28,706.3 29,091.4
Population, 10-14 yr
yrs,
s, total, '000 13,300.8 19,775.4 22,075.9 23,581.3 25,033.7 26,542.4 28,598.2
Population, 15-19 yr
yrs,
s, total, '000 11,211.4 16,539.7 19,514.5 21,796.3 22,870.8 24,474.3 26,365.5
Population, 20-24 yr
yrs,
s, total, '000 9,813.8 13,207.1 16,108.7 18,938.5 20,285.4 21,474.7 24,114.2
Population, 25-29 yr
yrs,
s, total, '000 8,804.6 10,966.9 12,794.2 15,451.3 17,273.3 18,586.1 21,050.6
Population, 30-34 yr
yrs,
s, total, '000 7,491.9 9,475.1 10,639.7 12,248.7 14,114.5 15,842.4 18,211.2
Population, 35-39 yr
yrs,
s, total, '000 5,904.6 8,454.2 9,208.3 10,215.4 11,280.9 13,055.9 15,522.1
Population, 40-44 yr
yrs,
s, total, '000 4,904.3 7,154.0 8,213.1 8,862.3 9,511.7 10,512.5 12,766.5
Population, 45-49 yr
yrs,
s, total, '000 4,290.7 5,581.0 6,916.3 7,892.7 8,308.5 8,914.1 10,221.7
Population, 50-54 yr
yrs,
s, total, '000 3,479.4 4,551.5 5,337.7 6,591.6 7,396.0 7,781.7 8,578.2
Population, 55-59 yr
yrs,
s, total, '000 2,822.2 3,862.8 4,274.3 5,003.0 6,105.0 6,860.8 7,358.6
Population, 60-64 yr
yrs,
s, total, '000 2,226.5 2,978.6 3,521.6 3,893.6 4,514.9 5,529.0 6,302.9
Population, 65-69 yr
yrs,
s, total, '000 1,682.1 2,226.2 2,585.3 3,061.5 3,357.5 3,910.3 4,841.3
Population, 70-74 yr
yrs,
s, total, '000 1,157.8 1,537.4 1,780.4 2,074.9 2,443.6 2,689.1 3,160.9
Population, 75-79 yr
yrs,
s, total, '000 690.9 934.0 1,074.8 1,251.9 1,451.4 1,722.8 1,905.6
Population, 80-84 yr
yrs,
s, total, '000 321.0 451.6 524.2 607.7 701.9 823.1 989.3
Population, 85-89 yr
yrs,
s, total, '000 109.2 157.0 181.4 212.3 239.5 280.4 336.4
Population, 90-94 yr
yrs,
s, total, '000 22.3 32.8 36.7 42.8 44.9 54.7 70.0
Population, 95-99 yr
yrs,
s, total, '000 2.8 4.4 2.6 3.2 1.8 3.2 7.1
Population, 100+ yr
yrs,
s, total, '000 0.3 0.4 0.1 0.0 0.0 0.0 0.2
f = BMI forecast. Source: World Bank, UN, BMI

[Link]/bmi 78

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Population B
Byy Age Gr
Group,
oup, % (P
(Pakistan
akistan 1990-2025)
Indicator 1990 2000 2005 2010 2015 2020 2025f
Population, 0-4 yr
yrs,
s, % total 17.77 15.72 14.82 14.11 13.88 12.95 12.19
Population, 5-9 yr
yrs,
s, % total 14.44 14.39 13.61 13.01 12.68 12.63 11.64
Population, 10-14 yr
yrs,
s, % total 11.52 12.81 12.66 12.13 11.87 11.68 11.44
Population, 15-19 yr
yrs,
s, % total 9.71 10.71 11.19 11.21 10.84 10.77 10.55
Population, 20-24 yr
yrs,
s, % total 8.50 8.56 9.24 9.74 9.62 9.45 9.65
Population, 25-29 yr
yrs,
s, % total 7.63 7.10 7.34 7.95 8.19 8.18 8.42
Population, 30-34 yr
yrs,
s, % total 6.49 6.14 6.10 6.30 6.69 6.97 7.29
Population, 35-39 yr
yrs,
s, % total 5.12 5.48 5.28 5.25 5.35 5.75 6.21
Population, 40-44 yr
yrs,
s, % total 4.25 4.63 4.71 4.56 4.51 4.63 5.11
Population, 45-49 yr
yrs,
s, % total 3.72 3.62 3.97 4.06 3.94 3.92 4.09
Population, 50-54 yr
yrs,
s, % total 3.01 2.95 3.06 3.39 3.51 3.43 3.43
Population, 55-59 yr
yrs,
s, % total 2.45 2.50 2.45 2.57 2.89 3.02 2.94
Population, 60-64 yr
yrs,
s, % total 1.93 1.93 2.02 2.00 2.14 2.43 2.52
Population, 65-69 yr
yrs,
s, % total 1.46 1.44 1.48 1.57 1.59 1.72 1.94
Population, 70-74 yr
yrs,
s, % total 1.00 1.00 1.02 1.07 1.16 1.18 1.26
Population, 75-79 yr
yrs,
s, % total 0.60 0.61 0.62 0.64 0.69 0.76 0.76
Population, 80-84 yr
yrs,
s, % total 0.28 0.29 0.30 0.31 0.33 0.36 0.40
Population, 85-89 yr
yrs,
s, % total 0.09 0.10 0.10 0.11 0.11 0.12 0.13
Population, 90-94 yr
yrs,
s, % total 0.02 0.02 0.02 0.02 0.02 0.02 0.03
Population, 95-99 yr
yrs,
s, % total 0.00 0.00 0.00 0.00 0.00 0.00 0.00
Population, 100+ yr
yrs,
s, % total 0.00 0.00 0.00 0.00 0.00 0.00 0.00
f = BMI forecast. Source: World Bank, UN, BMI

[Link]/bmi 79

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Agribusiness Methodology
Connected Thinking

BMI employs a unique methodology known as 'Connected Thinking'. This means that our analysis captures the inter-relatedness of
the global economy, and takes into account all of the relevant political, macroeconomic, financial market and industry factors that
underpin a forecast and view. We then integrate them so as to explain how they interact and affect each other. Our Connected
Thinking approach provides our customers with unique and valuable insight on all relevant macroeconomic, political and industry
risk factors that will impact their operations and revenue-generating potential in the industry/industries within which they operate.

We use a transparent forecasting model as a base for our industry forecasts, but rely heavily on our analysts' expert judgement to
ensure our forecasts capture all of the insights we derive using our unique Connected Thinking approach. We believe analyst
expertise and judgement are the best ways to provide the most accurate, up-to-date and comprehensive insight to our customers.

Agribusiness Methodology

For the Agribusiness industry we have historical data and five-year forecasts for up to 17 commodities per market, including the
production and consumption of key grains, softs and meat.

Our forecasts are a combination of regression modelling and analyst expert judgement.

Our Agribusiness analysts interact with other analytical teams in BMI, including Country Risk, Food & Drink and Infrastructure. This is
to ensure they have a comprehensive understanding of external factors that may impact the Agribusiness industry outlook.

Within the Agribusiness industry, issues that might result in analyst expert judgement could include but are not limited to:

• technological developments that might influence future output levels (for example greater use of biotechnology)
• dramatic changes in local production levels due to public or private sector investment
• regulatory environment and specific areas of legislation, such as import and export tariffs, and farm subsidies
• changes in lifestyles and general societal trends
• formation of bilateral and multilateral trading agreements, and political factors

There is a constant rolling cycle of data monitoring, with databases being updated on a quarterly basis. Analysts will intervene
outside of these cycles to implement forecast changes when necessary.

Historical figures for Agricultural commodities production and consumption are based on data published by local agriculture
ministries and when necessary are supplemented by data from the US Department of Agriculture, the UN Food and Agricultural
Organization (FAO) and the International Cocoa Organization.

[Link]/bmi 80

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

Industry-Specific Methodology

Production

Our production forecasts are based on a regression model, using a market's own historical time series.

We also apply analyst expert judgement to refine and finalise the various agricultural commodities production forecasts based on
exogenous and endogenous variables or events not captured by our regression model.

Agricultur
Agricultural
al Commodities FFor
orecast
ecast
Grains Softs Dairy Meat
Wheat Sugar Whole milk powder Pork
Corn Coffee Liquid milk Beef and veal
Barley Cocoa Butter Poultry (excluding turkey)
Ric
Ricee Cotton Cheese
So
Soybean
ybean Palm oil

Source: BMI

Consumption

Our consumption forecasts are based on a regression model using a market's own historical time series and key macroeconomic
explanatory variables from our Country Risk service, such as private final consumption, inflation and interest rates.

Agribusiness Market Value

The construction of the agribusiness market value is done in two steps:

• We construct an in-house model of the agribusiness market, where for each commodity its forecast production value is
multiplied by its commodity price. This is repeated for each commodity in our agribusiness universe and then aggregated to give
an agribusiness total market value. Commodity prices reflect either market prices or production prices; this depends on the
commodity in question and whether or not sufficient data is available.
• We use an in-house agribusiness total market value model as a benchmark model to forecast the FAO's gross production value. If
necessary, analysts can subjectively intervene in the model to take into account qualitative data.

To summarise, the final agribusiness market value is historical data from the FAO gross production value which is then forecast using
an in-house agribusiness market value model that is objectively and subjectively estimated.

The model itself is priced in US dollars. Conversion to local currency and euros is done directly using our Country Risk exchange rate
forecasts.

[Link]/bmi 81

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.
Pakistan Agribusiness Report | Q2 2025

We ensure that the internal model best matches the FAO gross production value definition and construction to ensure that the
internal model serves as a useful benchmark.

FAO Definition Of Gross Production Value (USD)

The value of gross production has been compiled by multiplying gross production in physical terms by output prices at farm gate.
Value of production measures production in monetary terms at the farm gate level. Since intermediate uses within the agricultural
industry (seed and feed) have not been subtracted from production data, this value of production aggregate refers to the notion of
gross production.

[Link]/bmi 82

IS SN: 2040-0411
ISSN:

Copy Deadline: March 2025

opy

Powered by TCPDF ([Link])

Downloaded by in-ximbhub from [Link] at 2025-05-24 [Link] UTC. EMIS. Unauthorized Distribution Prohibited.

Common questions

Recent advancements in genetically engineered crops are poised to significantly influence global food security strategies by increasing agricultural yields and enhancing resilience against environmental stressors. Countries like China have begun embracing GM varieties to boost production and self-sufficiency, thereby insulating themselves from global market volatilities . These crops, bred for higher yields and resistance to pests and herbicides, present an opportunity to diversify and stabilize food supplies. However, broad adoption faces hurdles, including regulatory acceptance and public perception, which continue to shape international food security frameworks .

The long-term sustainability of US-based industrial metal industries could be adversely affected by US-led tariff shifts due to several factors. Tariffs may lead to retaliatory measures from other countries, reducing export opportunities and increasing raw material costs. The expected strengthening of the US dollar as a result of tariffs could also make US exports less competitive internationally . Although there might be short-term price increases benefiting domestic producers, the overall market environment is likely to become less favorable due to the higher costs and disrupted trade relationships .

China's approval of multiple genetically modified crop varieties is intended to boost domestic food production and decrease import reliance, aligning with long-term food security goals. These GM varieties are designed for higher yields and better resistance to pests and herbicides . While the commercialization of GM crops poses an upside risk to grain production forecasts, their mass adoption is not anticipated in the medium term. This initiative reflects China's strategic effort to secure food supplies internally amidst geopolitical tensions and exemplifies its growing political emphasis on agricultural self-sufficiency .

India's fertilizer subsidy policies are designed to support farmers by making fertilizers affordable, thus maintaining agricultural productivity and political stability given the sector's importance as a political base. With a forecasted allocation decrease for fiscal year 2024-2025, the government expects lower fertilizer prices and aims to improve efficiency in fertilizer use . However, the persistence of subsidies reflects the need to counterbalance potential imbalances due to dependency on imports and underdeveloped agricultural infrastructure . These policies will likely continue, especially with upcoming elections, to maintain the support of the rural voting base .

US trade tariffs, specifically those led by Trump, are likely to impose short-term upward pressure on industrial metal prices due to market uncertainties and potential trade restrictions. However, the longer-term outlook remains bearish as tariffs can strengthen the US dollar, which inversely affects metal prices by making them more expensive in other currencies . Tariffs also pose headwinds by possibly instigating trade retaliations, impacting both import and export dynamics .

Geopolitical dynamics heavily impact agricultural product markets by shaping import dependencies and influencing national policies. For instance, China's emphasis on genetically modified crops seeks to bolster self-sufficiency and mitigate reliance on US imports, exemplified by the US-China trade tensions and subsequent tariffs on US soybeans, which highlighted vulnerability in China’s food supply . Similarly, India's diversification efforts, such as increasing domestic fertilizers and nano urea production, are fueled by the need to reduce import dependency and enhance agricultural resilience . These dynamics illustrate the intricate relationship between global politics and agricultural strategies.

China's advancements in agricultural biotechnology, such as the approval of GM seeds, are part of broader efforts to increase domestic food production, aiming for self-sufficiency and reduced global market dependency . This innovation is crucial in addressing challenges posed by a shrinking arable landmass amid a growing population. The focus on genetic modification and improved yield crops is strategic for overcoming barriers to reform while enhancing food security, which is politically significant under national security concerns exacerbated by US-China trade tensions .

Fertilizer market trends in South East Asia are positively correlated with agricultural yield predictions, as adequate fertilizer use is crucial to sustaining and enhancing crop output. The region, maintaining steady rice and palm oil output, benefits from robust demand for nitrogen and potash-based fertilizers to support these crops . Particular growth in countries like Thailand and Indonesia signals an increasing demand for fertilizers, driven by a projection of continued healthy yields and expansion in emerging markets such as Cambodia and Myanmar . Meanwhile, excessive past use and current constraints in Vietnam exemplify the delicate balancing needed between fertilizer input and sustainable yield growth .

Global rice production is expected to rebound significantly in 2024/25, with a projected increase of 5.21% year-on-year, reaching 145 million tonnes. This is attributed to anticipated abundant harvests in India, relaxation of export restrictions, and favorable weather conditions from a mild La Niña event benefiting Southeast Asian production . Additionally, beginning stocks are set to increase in key countries like India, Pakistan, and Thailand, further contributing to a bearish sentiment on prices .

The bearish sentiment in the grain markets is influenced by improving weather conditions, which have temporarily eased drought concerns, and the anticipated increase in Brazilian corn exports that will alleviate market tightness . Additionally, weak import demand from Mainland China is expected to persist as a predominant bearish factor, further depressing soybean prices despite a relatively stable week-on-week performance . Moreover, while increased corn plantings are expected to occur, rising fertilizer prices could impact this trend negatively .

India Agribusiness Report Q2 2025
No ratings yet
India Agribusiness Report Q2 2025
131 pages
Egypt Agribusiness Report Q2 2019
No ratings yet
Egypt Agribusiness Report Q2 2019
68 pages
Asia Agribusiness Market Insights 2023
No ratings yet
Asia Agribusiness Market Insights 2023
4 pages
Vietnam Agribusiness Report - Q3 2022
100% (1)
Vietnam Agribusiness Report - Q3 2022
102 pages
Vietnam Agribusiness Report Q1 2019
No ratings yet
Vietnam Agribusiness Report Q1 2019
82 pages
Fitch Vietnam Agribusiness Report - 2020-07-24
No ratings yet
Fitch Vietnam Agribusiness Report - 2020-07-24
89 pages
Asia Pacific Agribusiness Insight
No ratings yet
Asia Pacific Agribusiness Insight
18 pages
Egypt Agribusiness Report - Q1 2021
No ratings yet
Egypt Agribusiness Report - Q1 2021
78 pages
Egypt Agribusiness Outlook Q2 2022
No ratings yet
Egypt Agribusiness Outlook Q2 2022
99 pages
Rethinking Farming with Location Intelligence
No ratings yet
Rethinking Farming with Location Intelligence
20 pages
Emerging Markets Monitor - October 2024
No ratings yet
Emerging Markets Monitor - October 2024
26 pages
India Food & Drink Report - Q3 2020 PDF
No ratings yet
India Food & Drink Report - Q3 2020 PDF
87 pages
Pennsylvania Agriculture Economic Analysis 2025
No ratings yet
Pennsylvania Agriculture Economic Analysis 2025
79 pages
Egypt Infrastructure Report Q1 2025
No ratings yet
Egypt Infrastructure Report Q1 2025
81 pages
North East Asia Economic Outlook 2023
No ratings yet
North East Asia Economic Outlook 2023
17 pages
Agritech Investment Trends in India 2025
No ratings yet
Agritech Investment Trends in India 2025
16 pages
Empowering Small Farmers in Pakistan
No ratings yet
Empowering Small Farmers in Pakistan
21 pages
Pakistan's Rice Export Landscape
0% (1)
Pakistan's Rice Export Landscape
30 pages
HDFC Bank Agricultural Loan Insights
No ratings yet
HDFC Bank Agricultural Loan Insights
39 pages
Industry Risk Score for Tractors 2022
No ratings yet
Industry Risk Score for Tractors 2022
10 pages
Food Industry Dynamics in Pakistan
No ratings yet
Food Industry Dynamics in Pakistan
5 pages
Indian Rice Industry Growth Insights
No ratings yet
Indian Rice Industry Growth Insights
89 pages
India Agribusiness Report Q3 2010 Insights
No ratings yet
India Agribusiness Report Q3 2010 Insights
4 pages
Fauji Fertilizer Financial Analysis Report
75% (4)
Fauji Fertilizer Financial Analysis Report
174 pages
SBI Kisan Samriddhi Rin Overview
No ratings yet
SBI Kisan Samriddhi Rin Overview
38 pages
MINT HD NewDelhi - Delhi 27 09 2021
No ratings yet
MINT HD NewDelhi - Delhi 27 09 2021
22 pages
BCG
No ratings yet
BCG
138 pages
EMIS Insights - India Agribusiness Sector Report 2023-2024
No ratings yet
EMIS Insights - India Agribusiness Sector Report 2023-2024
62 pages
Agriculture in India: Euromonitor International March 2021
No ratings yet
Agriculture in India: Euromonitor International March 2021
24 pages
Vegetable Oils Market Insights for SMEs
No ratings yet
Vegetable Oils Market Insights for SMEs
24 pages
Challenges in Pakistan's Agriculture Sector
No ratings yet
Challenges in Pakistan's Agriculture Sector
31 pages
Agribusiness Solutions and Financial Consulting
No ratings yet
Agribusiness Solutions and Financial Consulting
4 pages
Indian Agriculture Market Trends 2012-2017
No ratings yet
Indian Agriculture Market Trends 2012-2017
2 pages
Analytics To Address The Increasingly Complex Global Agricultural Market
No ratings yet
Analytics To Address The Increasingly Complex Global Agricultural Market
9 pages
Al-Khair Rice Mills Rating Report 2023
No ratings yet
Al-Khair Rice Mills Rating Report 2023
5 pages
Key Insights on Pakistan's Economy
No ratings yet
Key Insights on Pakistan's Economy
26 pages
Pakistan Country Risk Report
No ratings yet
Pakistan Country Risk Report
75 pages
Kisan Samriddhi Rin Interest Rates
No ratings yet
Kisan Samriddhi Rin Interest Rates
49 pages
India's Agriculture and Allied Growth
No ratings yet
India's Agriculture and Allied Growth
10 pages
Egypt Agribusiness Report Q2 2018
No ratings yet
Egypt Agribusiness Report Q2 2018
69 pages
Honduras Country Risk & Industry Insights
No ratings yet
Honduras Country Risk & Industry Insights
31 pages
Sahyadri Farms: Distribution Insights
No ratings yet
Sahyadri Farms: Distribution Insights
16 pages
India Rice Exports Surge 30% H1CY25
No ratings yet
India Rice Exports Surge 30% H1CY25
4 pages
India's Industrial Production Grows 3.5%
No ratings yet
India's Industrial Production Grows 3.5%
3 pages
Coromandel Investor Presentation 2020
No ratings yet
Coromandel Investor Presentation 2020
45 pages
Accenture Agribusiness
100% (1)
Accenture Agribusiness
16 pages
Britannia Industries Valuation Insights
No ratings yet
Britannia Industries Valuation Insights
28 pages
Britannia Equity Research Report 2024
No ratings yet
Britannia Equity Research Report 2024
25 pages
Middle East & Africa Agribusiness Insight
No ratings yet
Middle East & Africa Agribusiness Insight
21 pages
K.K. Rice Mills Rating Analysis Report
No ratings yet
K.K. Rice Mills Rating Analysis Report
5 pages
Vietnam Beverage Consumption Trends 2024
No ratings yet
Vietnam Beverage Consumption Trends 2024
70 pages
JK Agri Annual Report 2023-24
No ratings yet
JK Agri Annual Report 2023-24
92 pages
Agriculture Sector Growth in India
No ratings yet
Agriculture Sector Growth in India
24 pages
Contemporary Issues in Pakistan's Economy
No ratings yet
Contemporary Issues in Pakistan's Economy
87 pages
Agriculture Sector Risk Report 2023
No ratings yet
Agriculture Sector Risk Report 2023
46 pages
Bridging Trust in Indian Agriculture
No ratings yet
Bridging Trust in Indian Agriculture
1 page
Agricultural Marketing in India: Insights
No ratings yet
Agricultural Marketing in India: Insights
16 pages
Agribusiness: Trends, Challenges, and Stats
No ratings yet
Agribusiness: Trends, Challenges, and Stats
23 pages
Economic Analysis of Haryana Rice Value Chain
No ratings yet
Economic Analysis of Haryana Rice Value Chain
10 pages
Rice
No ratings yet
Rice
15 pages
Value Chain in Haryana
No ratings yet
Value Chain in Haryana
10 pages
Food Outlook Report Data
No ratings yet
Food Outlook Report Data
90 pages
Valure Chain Report
No ratings yet
Valure Chain Report
10 pages
Outlook For Thailand Exports
No ratings yet
Outlook For Thailand Exports
30 pages
AMIS Agri-Market Monitor Report
No ratings yet
AMIS Agri-Market Monitor Report
19 pages
Emission Reduction in Rice Production
No ratings yet
Emission Reduction in Rice Production
83 pages
Domestic Rice Utilization in Nigeria 2019-2020
No ratings yet
Domestic Rice Utilization in Nigeria 2019-2020
29 pages
Aluminium Low-Carbon Methodology
No ratings yet
Aluminium Low-Carbon Methodology
12 pages
Agricultural Professional Resume - Kenya
No ratings yet
Agricultural Professional Resume - Kenya
3 pages
The Sugar Revolution in the Caribbean
100% (4)
The Sugar Revolution in the Caribbean
3 pages
Erosion and Weathering Test for Grade 5
No ratings yet
Erosion and Weathering Test for Grade 5
3 pages
Joplin Schools Meal Assistance Policy
No ratings yet
Joplin Schools Meal Assistance Policy
2 pages
Organic Fertilizer Seminar for Youth
No ratings yet
Organic Fertilizer Seminar for Youth
2 pages
Review On Determinants of Livelihood Diversfication in Ethiopia
No ratings yet
Review On Determinants of Livelihood Diversfication in Ethiopia
8 pages
Population Growth and Resource Management Insights
No ratings yet
Population Growth and Resource Management Insights
8 pages
English Vocabulary List with Vietnamese
No ratings yet
English Vocabulary List with Vietnamese
2 pages
NIAW Mismanagement and Community Impact
No ratings yet
NIAW Mismanagement and Community Impact
24 pages
Agro-Climatic Zones of India Overview
No ratings yet
Agro-Climatic Zones of India Overview
15 pages
sa2-6thEngSL AnsKey 1772097558
No ratings yet
sa2-6thEngSL AnsKey 1772097558
2 pages
School-Based Feeding Program Report
No ratings yet
School-Based Feeding Program Report
20 pages
Organic vs Conventional Viticulture Study
No ratings yet
Organic vs Conventional Viticulture Study
9 pages
Impact of 2.3.2(22) Fertilizer on Spinach
No ratings yet
Impact of 2.3.2(22) Fertilizer on Spinach
2 pages
Agricultural Engineering Overview and Impact
No ratings yet
Agricultural Engineering Overview and Impact
13 pages
Trends in Rural Power Structures in Haryana
No ratings yet
Trends in Rural Power Structures in Haryana
4 pages
Orchard Layout Design Systems Explained
No ratings yet
Orchard Layout Design Systems Explained
23 pages
Overview of Agriculture in Pakistan
No ratings yet
Overview of Agriculture in Pakistan
18 pages
Supply and Demand Concepts Explained
No ratings yet
Supply and Demand Concepts Explained
18 pages
Isolation Techniques for AM Fungal Spores
No ratings yet
Isolation Techniques for AM Fungal Spores
12 pages
Fertilizer Industry Member Directory
No ratings yet
Fertilizer Industry Member Directory
11 pages
Overview of Gilgit-Baltistan History
No ratings yet
Overview of Gilgit-Baltistan History
29 pages
Analysis of "The Greenhouse Effect" Poem
No ratings yet
Analysis of "The Greenhouse Effect" Poem
4 pages
Major Environmental Issues in India
0% (1)
Major Environmental Issues in India
3 pages
Grade 7 Animal Production Lesson Plan
No ratings yet
Grade 7 Animal Production Lesson Plan
14 pages
Significance of Rural Development in India
No ratings yet
Significance of Rural Development in India
16 pages
Zinc and Boron Effects on Chickpea Growth
No ratings yet
Zinc and Boron Effects on Chickpea Growth
7 pages
Coimbatore Hotel Invoice Summary
No ratings yet
Coimbatore Hotel Invoice Summary
7 pages
Heliconia Intercropping in Coconut Cultivation
No ratings yet
Heliconia Intercropping in Coconut Cultivation
5 pages
Usufruct Agreement for CFBW Project
No ratings yet
Usufruct Agreement for CFBW Project
3 pages