Untapped potential of dry fruityield and export

trade
Nuts case Dry fruits
processing, value-addition and exports can earn billions in foreign exchange
By Tahir Ali

Pakistan produces abundant quality dry fruits like almonds, figs, pistachio, walnuts, pine nuts, dates, raisins, dry apricots and peanuts. But its dry fruits exports have been far less for lack of standardised packaging, grading and value-addition and some other policy constraints.

Mechanised grading and packaging has started but, for lack of cool chain system, an estimated 30-50 per cent of the total fruit production is still lost during harvesting, transportation, preservation and storage. Total annual loss of dry fruits in term of rupees is estimated at Rs60 billion.

Dry fruits exports in the last five years, according to Federal Commerce Minister Makhdoom Amin Fahim, were 505,124 metric tonnes. Total dry fruits exported were 81,387 MT in 2005-06 which rose to 99,936MT next year but then dropped to 92,082MT in 2007-08. These, however, rose to 110,885MT in 2008-09 and then to 120,834 the next year.

“The government has taken numerous steps to increase dry fruit exports by encouraging the private sector to develop dry fruits processing units in northern areas of Pakistan, developing of solar processing units, initiating projects for processing and drying of dates in Turbat, Khairpur and DI Khan and sending delegations of exporters to international food fares and exhibitions and potential markets of food items,” he had told the Senate in May last year.

Under the medium term development framework, Pakistan targeted fruit exports of $238 million in 2010 and it reached up to $290 million. These can be increased even further.

But absence of farm-to-market roads, outdated post-harvest techniques for unskilled labour, poverty and ignorance of producers, non-market oriented production, and lack of quality certifications are making it difficult to improve the quality and quantity of exports.

An integrated ‘Cool Chain System’ project worth over Rs13 billion, being envisioned under the national trade corridor improvement programme that aims at 10 per cent reduction in post-harvest losses, is likely to save Rs6 billion annually. But any export development initiative will not bear any fruit unless linkages of stakeholders with international markets are established and close collaboration between the public and private sectors are ensured.

Negligence of the government to tap the real potential of this treasure of Pakistan can be gauged from the fact that out of dozens of projects of the Pakistan Horticulture Development and Export Company (PHDEC), which are either in operation, near execution or being considered for launching, not a single one is meant for the dry fruit development in the country.

Pakistan’s fruit production is mostly organic and, therefore, acceptable to the world. But non-compliance to the international standards and inability of Pakistan’s 58 trade missions in 43 countries worldwide that are supposed to work for promoting Pakistani exports in close collaboration with trade development authority (TDAP) and PHDEC appear to have restricted its exports and appeal for international consumers.

Dry fruit development also could not find any place in the 12 projects the TDAP intends to launch for improvement of different fruits in the country. Dry fruits such as fig, raisin, pistachio, dry apricot and pine nuts etc face insect infestation at some stage of their storage and transportation. Food Irradiation Technology (FIT) not only saves them from insect infestation but also increases their shelf life. FIT also helps dry fruit exporters meet international quarantine requirements.

Though the federal government had granted approval for the technology in 1996, FIT could not deliver optimum benefits for lack of irradiation facilities in the country.

Pakistan’s fruit exports will get a fillip once its products are produced and prepared in compliance with certain export-related certifications such as the Hazard Analysis and Critical Control Point (HACCP), Global Good Agriculture Practices (GGAP), British Retailer’s Consortium (BRC), Monitoring of Maximum Residues Limits (MRL) and Fair-trade Labelling Organisations (FLO).

With the world becoming increasingly sensitive to food quality issues, Pakistan’s fresh fruit export industry will have to ensure compliance with international standards and certification mainly focused on food safety, traceability, residues of different agrochemicals, lack of good agricultural practices, reduction of post-harvest diseases and pests and issues pertaining to safety of food packaging materials.

The TDAP and PHDEC should open its regional liaison offices in the dry fruit specific KP, federally/provincial administered tribal and northern areas. The government also needs to open common facility centres, dry fruit collection points, processing plants, product testing laboratories and guidance and counselling centres in the production areas.

There is, regrettably, not a single mention of dry fruit in the current KP’s horticulture policy 2009 as if dry fruits are not part of the sector and as if not produced in the province. Coordination between the TDAP and PHDEC and the Chambers of Agriculture and Chambers of Commerce and Industry should also be improved. The facilitation division in the TDAP needs to have closer cooperation with exporters. A few training institutes for dry fruit productivity/quality enhancement with funding from the export development fund also need to be established.

Cold weather and black marketing by dealers leads to increase in prices of dry fruits as winter comes. Per kilogramme prices of different qualities of walnuts at present are between Rs120-350 for whole and Rs400-1000 for its kernel, of pistachio between Rs600-1500, of almond Rs150-500 and its kernel at Rs400-900, of fig Rs300-600, dry dates Rs100-250, peanut Rs 160-180 and of chilghoza Rs1500-2400 in the open market in different parts of the country.

Despite extensive search and contacts, the exact figure of countrywide production of dry fruits could not be ascertained. Based on an average consumption of dry fruits at nominal one kilogramme per person per month, total annual consumption comes to 2040 million kgs or 2 million metric tonnes.

However, Siraj Muhammad, Deputy Director Information of the Agriculture Ministry Khyber-Pakhtunkhwa, says the province produced 13000 tonnes of walnuts, 11500 tonnes of dates, 19000 tonnes of apricot and 25000 tonnes of other dry fruits. Pine nut is Pakistan’s characteristic dry fruit. Several parts of KP, Balochistan, federally-administered tribal and northern areas have plenty of pine trees which could be further increased.

According to an estimate, the total production of pine nut in the country is estimated at 21,000 tonnes. With the current price of Rs70,000 per 50kg (Rs1.75mn per tonne) in the wholesale market, the production is worth over Rs36 billion per year. It could earn plenty of foreign exchange for the country provided the commodity is produced on mass commercial scale.

Walnut production is around 20,000 tonnes per year — mostly produced in KP and Azad Kashmir. With a price of Rs12000 per 50kg (Rs0.3mn per tonne), walnut’s total income is Rs6 billion. That could increase to hundreds of billions of rupees as, according to locals from Malakand division, over 90 per cent potential of the area for walnut and other dry fruits still remains to be utilised.

The horticulture export, according to the national trade policy, was to be made into an industry to enable it to qualify for institutional credit and relief in taxation. The government should announce a rebate in duties and a dry fruit specific export finance scheme for dry fruit exporters. It should provide support to fruit exporters to open their retail outlets in foreign countries. Pakistan International Airline also needs to bring down it freight charges for exporters.

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About Tahir Ali Khan
I am an academic, freelance columnist, writer and a social worker.

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