Our Projects

1. Technology: Modern seed for Pakistan’s cotton farmers

A vibrant seed industry is central to harnessing the growth potential of agriculture. Pakistan’s seed industry is in disarray, where no significant investment is being made by the private sector in research and development for the field crops due to Pakistan’s poor IPR regime. PAC evaluated the options for addressing this problem and concluded that, if the true potential is to be tapped, the leading conglomerates will have to invest in the seed sector. In order to understand the implications, PAC led the development of a pre-feasibility through international expertise.
Subsequently, PAC designed a program to establish Pakistan’s first world-class cotton seed company to provide cotton farmers with high-germination, high-yielding, highly pure and highly pest/insect resistant cotton seed. The initiative is being backed by three of Pakistan’s leading textile groups i.e. Sapphire, Fatima and Nishat Group which purchase 20-25% of Pakistan’s cotton lint. Dr. Don Keim and Dr. Albert Santos, who are U.S based cotton breeders and are known to be among the best cotton breeders in the world, have been engaged to steer the breeding component of the program. Dr. Neil Forrester, who is one of the world’s leading entomologists and an international business strategist based in Australia advised on its business development aspects. SANIFA’s breeding trials have already shown double the seed germinationlevels currently prevailing in Pakistan. During the 2018 season, SANIFA planted cotton at 9 different locations and achieved significantly higher yields than the current national average. They had also managed the decrease the trash content from 8-9 percent to 3 percent. SANIFA is ready to commence its commercial operations starting 2019 season.

2. Market Access for Farmers: Electronic Trading platform

Pakistan’s current wholesale markets inadequately serve those who are interested in high-quality produce grown to specifications. The quality of the product is not preserved as the traditional markets lack the appropriate infrastructure and expertise. Non-transparent pricing is the norm because of the concentration of market power among certain intermediaries. The market mechanism does not reward quality, which does not provide the farmer with an incentive to invest in modern and efficient agricultural practices.
Based on the above assessment, PAC decided to bring together different contributors to the agricultural value-chain in order to build an e-Trading Platform where high-quality standardized agricultural products are traded. The e-Trading Platform for red chillies was officially launched in October 2015, where PAC was able to secure the involvement of three specialized partners in this market model: Agility Logistics, SGS Pakistan, and Pakistan Mercantile Exchange (PMEX). The services, which constitute this model—world class testing by SGS, warehousing by Agility, Trading Platform by PMEX, and facilitation/extension services by PAC—are covered by a transaction charge. Even with this transaction charge the sellers are making a higher profit at the e-Trading Platform as compared to traditional markets as they are getting better price, quick payment, and no unfair deductions. Red chillies worth US$ 1.2 million were traded during this pilot. Farmers and traders who used this facility have responded very positively and around US $9.9 million worth of red chillies havebeen traded through the e-Trading Platform since. PAC is now working on replicating this model for other crops as well. Click here for a brief video. A visual representation of the model is shown below.

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3.Broadening Knowledge Base: BBA Agriculture degree program

In early 2014, PAC brought about a collaboration between University of Agriculture, Faisalabad (UAF), Faisalabad and Institute of Business Administration (IBA), Sukkur to develop a 4-year BBA Agribusiness program that provides technical skills and business development and management training to students. The participating institutions, which offer industry-specific trainings and internships to the students include HBL, Fatima Fertilizers, Fauji Fertilizers, Engro Fertilizers, ICI Pakistan, Syngenta, Pakistan Tobacco Company, Mirpurkhas Sugar Mills, Pakistan Sugar-Mills Association and Al Moiz Sugar Mills. The program started on 14th July 2014 and the first batch graduated in 2018 with job offers from Pakistan’s leading ago processors.
The success of the program has prompted the President of Pakistan, Dr. Arif Alvi, to direct HEC to replicate this program, with PAC’s help, at other suitable universities in Pakistan.

4. Agri-collateral management pilot through e-warehouse receipts

Farmers’ access to formal sector credit is highly constrained and they are mostly stuck with lenders from the informal sector who charge exorbitant interest rates. A key reason for constrained agri-lending is the use of farmers’ land as collateral by banks.
PAC has successfully piloted a business model for lending against crop (not land) as collateral for wheat farmers/sellers with the participation of Agility, SGS, PMEX, HBL for wheat crop in district Sheikhupura, Punjab, where HBL lent Rs. 4.8 million against 232 tons of wheat as collateral. PAC also replicated the same model for Basmati Paddy farmers in district Sheikhupura in November 2017 with Bank Islami, which also helped develop an Islamic banking model for the program. During the summer 2018 maize harvest, PAC conducted a comprehensive final pilot with MCB Bank as the conventional bank, Bank Islami as the Islamic bank, FINCA as the microfinance bank, Adamjee Insurance as the insurer, Islamabad Feeds as the warehouse operator and Agility Pakistan as the collateral manager.
The eco-system for electronic warehouse receipts-based agri-lending through the collateral management company (CMC) has been firmed up by these pilots. SECP, in collaboration with State Bank of Pakistan (SBP), Central Depository Company (CDC), Pakistan Mercantile Exchange (PMEX), Pakistan Agricultural Coalition (PAC) and other key stakeholders, developed Collateral Management (Establishment & Operations) Regulations in 2017 which will help expedite the formation of a CMC. A number of leading business groups in Pakistan have agreed to participate in the proposed CMC being developed by PAC.

5.Doubling Yields, Increasing Farmer Income – Full Service extension model

Pakistan’s small farmers have the potential to increase their yields (output per acre), quality, and increase their incomes. But their ability to realize this potential is constrained by factors that are well identified by now. Among these, the top three factors are:

  • Absence of an effective, neutral extension service with a command of the appropriate technologies for achieving sustained improvements in farm productivity,
  • Lack of quality agricultural inputs: high germination seed with varietal purity, unadulterated fertilizer and pesticides suited to the crop, suitable farm machinery, etc.,
  • Lack of timely credit at reasonable terms, and
  • Irregular market connectivity to buyers who value quality and are willing to pay for it.
Attempts to address one or more of the above factors have largely been supply-driven. Therefore, a business model was required for providing the farmer with the wherewithal for achieving improvements in yield and quality as well as increases in farmer income.

6.Doubling Pakistan’s Rice Exports by 2023

Rice accounts for nearly ten percent of Pakistan’s exports. Out of Pakistan’s exports of $23.2 billion in FY18, rice exports were $2 billion. Yet our rice yields are below global average at 39 maunds per acre. Therefore, improving farm productivity and cutting post-harvest losses (15-20%) present an opportunity for significantly increasing rice exports over the next five years. The Rice Exporters Association of Pakistan (REAP) has initiated the program for doubling rice exports from Pakistan in the next five years and sought advice from Pakistan Agricultural Coalition to help identify key interventions required to achieve this target.

The following interventions have been identified to help increase farm output and reduce losses:

  1. Better seed: The provision of good quality seed can make a significant increase in yields.
  2. Laser land leveling: Laser land levelingreduces water use by at least 15-20 percent and increases yields by 10-12 percent.
  3. Mechanical nursery sowing and transplantation: Mechanical nursery sowing and transplantation is expected increase plant population to 100,000 plants per acre compared to manual nursery raising and transplantation, which only achieves 45,000-50,000 plants per acre.
  4. Mechanical harvesting: Mechanical harvesting through rice-specific harvesters decreases paddy breakage up to 10% and cuts shattering losses by 5-7 maunds per acre, compared to harvesting using wheat combine harvesters.
  5. Mechanical drying and silo storage: Mechanical drying of harvested paddy cuts quality losses by preventing aflatoxins development, whereas storage of paddy in silos after drying cuts quantity losses by preventing rodent and insect infestation, spillage, etc.
PAC is actively coordinating between all stakeholders which includes leading progressive farmers, exporters, and input providers among others to conduct pilot projects on up to 2,000 acres in two districts in Sindh for the 2019 rice season. The lessons of these pilots would inform the final program design for full scale-up from 2020 onwards.

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