Rice export orders witness 60pc fall

November 19, 2012

Rice Export

LAHORE – The rice export orders have registered a sharp decline of 60 per cent than last year, as the artificial hike in prices of paddy, apart from causing inflation in the country, has knocked the exporters out of the international markets due to ineffective pricing against neighbouring country of India, industry sources stated on Sunday.

They said that Pakistan produces 6 million tons of rice while local consumption is just 2 million tons. Rest of 4 million tons rice can be exported if its rates remain at the level of international market.

Data reveals that Pakistan’s total rice exports in the outgoing fiscal year 2011-12 (July to June) have declined to 3.29 million tons, down 10.2 per cent from 3.67 million tons from 2010-11.

The slide in basmati rice exports was sharper at about 25 per cent from 1.17 million tons in 2010-11 to just over 900,000 tons in 2011-12. Non-basmati rice exports declined about 4.3 per cent from almost 2.5 million tons in 2010-11 to about 2.4 million tons in 2011-12. However, the value of non-basmati rice exports rose 3.7pc in 2011-12.

Total rice exports in June 2012 stood at 167,019 tons, down about 41 per cent from 284,871 tons in June 2011 and 12.5 per cent from 190,866 tons in May 2012. That includes non-basmati rice exports in June 2012 of 100,173 tons, down almost 40 per cent from 164,857 tons in June 2011, and basmati rice exports in June 2012 of 66,846 tons, down over 44 per cent from 120,014 tons exported in June 2011.

“India, being much cheaper source, has the advantage to substitute our international brand against their cheaper quality basmati, but we are struggling to keep our orders intact.”

“We need to keep regional parity intact. The Indian basmati is cheaper than our super basmati. We managed to extract $100 per metric ton premium for our basmati but the difference in pricing has reached to ever high levels of $250 per metric ton which is indigestible by most of the global buyers,” they observed.

Market sources said that the rates of rice have jumped by over 30 per cent in the period of just one week, as the non-conventional traders have jumped into the business and started hoarding rice, creating artificial scarcity of commodity.

The prices of super basmati have gone up Rs 4,000 per 40 kg from Rs 3,400 while rates of PK 386 have jumped to Rs 2,300 from Rs 1,800 per 40 kg.

The non-traders’ aim of minting money by piling stocks of rice will ultimately lead to food inflation in the country, they observed.

They expressed their concern over the criminal negligence of Punjab government, which has failed to crack down on the hoarders. “It is the responsibility of the Punjab government to control price-hike and take strict action against the profiteers and hoarders.

They said that the financial institutions are also supporting them with huge banking limits. They warned the financial institutions that such artificial price-hike would curb exports blatantly. They asked the State Bank of Pakistan to take serious steps against those banks, which are offering limits to such hoarders in the country. It’s the role of central bank to ensure that all financial limits be utilised against the assigned purpose only. They warned the banks that current prices may cause losses to non-traders elements, putting depositor’s money on stake.

Courtesy: The NATION

This website uses cookies to improve your experience. We'll assume you're ok with this, but you can opt-out if you wish. Accept Read More