WNAM REPORT: Wheat prices in Pakistan have surged to a 19-week high, reaching PKR 710 per 10kg, or PKR 2,839 per 40kg, with some market sources quoting rates as high as PKR 3,000–3,050 per 40kg. The sharp price recovery comes as a timely boost for farmers, especially ahead of the upcoming Rabi sowing season.
According to analysts, this rebound in prices is expected to incentivize wheat cultivation, reversing the declining trend seen earlier this year. Farmer sentiment had deteriorated due to poor returns during the last crop cycle, exacerbated by high input costs, weak support prices, and adverse climate conditions.
The agricultural sector has faced a sharp slowdown in FY25, with growth plunging to just 0.6%, a significant drop from 6.4% recorded in FY24. Key crop output fell by 13.5% year-on-year, with wheat production alone declining by 8.9%. According to the SBP, wheat output is expected to fall ~11% in FY25, as farmers scaled back sowing amid poor profitability.
A presentation by Fauji Fertilizer Company (FFC) highlighted that farmers incurred a loss of PKR 10,695 per acre this season, compared to a profit of PKR 13,572 per acre in the previous one.
Topline Securities, in a recent report, attributed farmer losses to the government’s decision to lift support prices under the IMF program, combined with soaring costs of fertilizer, seeds, and electricity.
Meanwhile, sugar prices have also spiked, rising from PKR 138–140/kg in January 2025 to PKR 180/kg, according to the Pakistan Bureau of Statistics (PBS). This is well above the official ex-mill price of PKR 165/kg. The rising prices of both wheat and sugar are expected to improve farmer incomes in the next crop cycle.
“This recovery in crop prices is likely to revive rural confidence and support household incomes, which is critical for boosting domestic consumption and overall economic growth,” said Topline Securities.
Improved rural incomes could stabilize agriculture’s contribution to GDP and reduce Pakistan’s reliance on food imports, enhancing food security. Additionally, a price recovery could benefit sectors tied to rural demand, including two-wheelers, hatchback and sedan passenger cars, construction materials, and clothing.
Atlas Honda, in a recent analyst briefing, noted that current motorcycle sales are being driven mainly by urban consumers due to rural economic stress. Analysts now expect a pickup in rural demand, particularly for motorbikes, as farm incomes recover.
While wheat prices remain 43% below the previous high of PKR 1,256 per 10kg — which was driven by smuggling and inflated support prices — the current increase offers a measure of relief for the country’s farmers. Adding to the optimism, urea prices, a key input cost, are expected to remain under control in the short term due to sufficient inventory.
Economists believe this uptick in rural purchasing power will complement the broader recovery in Pakistan’s economy, which has been hampered by weak agriculture performance over the last two years.
