Pakistan's Food Inflation Persisted by Structural Weaknesses

Pakistan's food inflation persists due to structural weaknesses in agriculture, making it vulnerable to global shocks. A report by Maldives Insight notes that high production costs, poor storage facilities, and climate damage contribute to persistent price hikes.

Rising energy costs, limited carryover stocks, and weaker output in some rainfed areas have constrained food supplies. Transport costs remain high, with wheat flour prices 50-75 per cent higher on an annual basis in June.

The report warns that even a good harvest cannot guarantee affordable food when production costs are structurally high. Agricultural exports decline when international prices and competitiveness deteriorate, while imported food and farm inputs become more expensive amid global market disruptions.

Pakistan's agricultural sector faces inefficiencies in irrigation, weak water management, low farm productivity, distorted commodity markets, and a small product base. Climate shocks have exacerbated these weaknesses, leaving millions exposed to shortages, price spikes, and declining purchasing power despite substantial food production.