Looking Ahead at 2025

What to watch for in the agriculture sector in 2025

Date: January 3, 2025

Kazim Saeed
CEO Pakistan Agricultural Coalition

Agriculture is slated as the sector that can salvage Pakistan’s ailing economy. But Pakistan’s farmers are in pain. Farmer forums are awash with shrill statements about the rising cost of farm inputs, exacerbated by the decline of the Pakistani rupee. On the revenue side, commodity prices rose historically after the COVID-19 period to benefit farmers but then adjusted unpredictably. The key variable that did not move up much is farm productivity: output per acre or output per animal. This is the context for any outlook for Pakistan’s agriculture for 2025. Further, the wider arc of change needed in Pakistan’s agriculture sector is a shift from the government-led agriculture sector set up in the 1960s and 1970s to a private sector-led agriculture sector.

In 2025, watch wheat—Pakistan’s staple food and largest crop by far. For six decades, the government has dominated every segment of the wheat value chain. Each year, the government has set the support price of wheat, purchased a quarter of the wheat harvest in April-May, stored this enormous volume, and then released it (Sept-Dec) to flour millers on the promise of reasonable flour prices. The policy goal: sasti roti (inexpensive bread) for citizens. But this framework has been rife with elite capture, market abuse, price volatility, and an enormous cost to government—all without achieving the goal. 

In 2024, the Government of Pakistan and the Government of Punjab surprised farmers by not purchasing wheat. It was a brutal cut which hurt farmers badly by the sudden crash in wheat prices. In 2025, the key development to watch is: what new framework the Government introduces to replace its outdated template. Ideally, a market-oriented framework should be introduced to engage the private sector for efficiencies and allow production of higher-value products based on wheat. 

The official seed landscape is similarly controlled by the Government with regulations from the 1970s. Quality seed is the great equalizer, in that it helps the small farmer raise farm productivity as much as it helps the larger players. But only reputable private seed companies can deliver this. In 2025, watch for more market-oriented seed regulations to be announced. This can be the best news for Pakistan’s trailing cotton crop, its export champion rice crop, and even the wheat crop.

It remains to be seen if the peak rice export of nearly four billion dollars in 2024 can be maintained in 2025.

Farmers have long suffered from climate uncertainty. Pakistan cannot alone prevent the accelerated pace of climate change but it can protect farmers through crop insurance. In 2025, watch for the announcement of crop insurance schemes.

Finally, watch for the rising engagement of Pakistan’s corporate and financial sector in agriculture. This has the prospect of bringing new capital, technology, and expertise to agriculture as well as modern services to farmers.

The point is not that the government should leave agriculture alone, but it should get out of the way of private players who can help create wealth in Pakistan’s rural areas.