Pakistan focuses on domestic cultivation of olives to bring down import bill

KARACHI: To reduce its dependence on the costly import of edible oils, Pakistan is increasing its focus on the domestic cultivation of olives, experts and farmers said, aiming to substitute the import of olive oil — which cost the country $11.1 million last year — with locally produced products within the next decade.
Pakistan in 2012 launched a major plantation project called Olive Valley in its Potohar region which includes Rawalpindi, Chakwal, Jhelum and Attock. The project, initiated by the Punjab government and executed by the Barani Agriculture Research Institute (BARI), was spread over 9,000 acres of land spanning the Mianwali and Khushab districts.
In 2019, Pakistan also commenced an ambitious drive to plant as many trees as possible from 550,000 high-quality olive saplings imported from Spain. The Pakistani military that year also helped graft nearly 25,000 wild olive plants in the country’s northwestern regions.
TrendEconomy, a Bulgaria-based global data warehouse, said Pakistan recorded an annual import decline of 4.13 percent in olive oil commodities last year. In 2020, Pakistan exported $17,968 worth of olive oil, including its by-products. The South Asian country imported edible oil worth $2.7 billion during this fiscal year, including $2.66 billion worth of palm oil and $95 million worth of soyabean.
“Though the [olive] plants are still in their early stages, the country had extracted around 53 tons of oil from domestic harvest last year,” Inamul Haq, a horticulturist at BARI who is working on the Olive Valley project, told Arab News. “Around 100 tons of olive fruit was produced last year.”
The new olive harvesting season, which will start in October this year, is expected to produce better yield, he added.
“We hope that within the next 5-7 years, the country would be able to replace the imports of olive oil to a large extent and within a decade would totally replace imports with the availability of oil at commercial scale,” Haq said.
“Commercial exports have not started yet but some food companies are working to export pickles made with olive oil,” Tariq Mehmood, a progressive olive farmer, told Arab News. “The production is gradually increasing.”
With a per capita consumption of 22 kilogram, Pakistan is the world’s eighth largest consumer of edible oil, with consumption standing at around 4-5 million tons, largely met through the import of palm oil and oilseed.
Pakistan’s edible oil market was recorded at Rs1,161 million in FY20, registering a year on year growth of 22 percent. Local consumption was recorded at around 4.9 million metric tons (MMT) in FY20, up three percent year on year, according to the Pakistan Credit Rating Agency (PACRA) research report.
“Pakistan used to produce 800,000 tons of oil locally every year from cotton seed and rapeseeds but due to crop decline the production has almost halved,” said Umer Rehan, a member of the executive committee of the Pakistan Vanaspati Manufacturers Association (PVMA).
He said the decline in local production was a burden on the foreign exchange position of the country but Pakistan could salvage the situation by “cultivating sunflowers in the coastal region of Sindh and refocusing on its cotton crop since the domestic demand for edible oil will increase as the country’s population will continue to grow.”
During the current fiscal year, Pakistan edible oil imports are anticipated to reach a record 3.7 million metric tons, up fve percent over the previous year to meet increased demand. Palm oil continues to be the major imported oil with imports forecast at 3.6 MMT, according to the Global Agricultural Information Network (GAIN).
As per GAIN data, oilseed imports are projected at 3.3 MMT, up six percent from the preceding year due to the growing importance of oilseed-based meals for the poultry, livestock and aquaculture sectors and the increasing production of edible oil for human consumption.