Global Rice News

Pakistan’s rice exports are set to reach a new high by June due to India’s decision to limit its own shipments. This change is driving buyers to source rice from Islamabad, as Pakistan is offering the grain at nearly 16-year high prices. These increased exports will help alleviate tight supplies that resulted from India’s restrictions and will boost Pakistan’s foreign exchange reserves, which are essential for financing imports.

According to Chela Ram Kewlani, chairman of the Rice Exporters Association of Pakistan (REAP), there has been a significant demand for rice in recent months, primarily because India halted its exports. India, which typically exports around 40% of globally traded rice, implemented a surprise ban on exports of non-basmati white rice and introduced export duties on parboiled rice.

Kewlani predicts that Pakistan’s exports could rise to 5 million metric tons in the 2023/24 financial year, compared to 3.7 million tons from the previous year. Some industry officials are even more optimistic, suggesting that exports could reach 5.2 million tons due to the substantial improvement in production this year.

Based on a dealer with a global trade house in New Delhi, Pakistan could produce between 9 and 9.5 million tons of rice in 2023/24. This is a significant increase from the 5.5 million tons produced last year, which was impacted by floods. The dealer also stated that Pakistan’s higher production and elevated global prices are enabling the country to export at a rapid pace. In December, Pakistan exported approximately 700,000 tons of rice alone.

For this year, basmati rice exports from Pakistan could increase by 60% to reach 950,000 tons, while non-basmati exports have the potential to surge by 36% to 4.25 million tons. In terms of value, Pakistan’s rice exports could exceed $3 billion this year, compared to $2.1 billion in the previous year.

Traditionally, Indian non-basmati rice was offered at a lower price than that of Pakistan. However, with India out of the market, buyers are shifting their attention to Pakistan, and local prices are gradually rising despite higher production. Hammad Attique, the director of sales and marketing at Lahore-based Latif Rice Mills, affirmed this trend.

Currently, Pakistan exports non-basmati rice mainly to Indonesia, Senegal, Mali, Ivory Coast, and Kenya. Premium basmati rice is exported to the European Union, Qatar, and Saudi Arabia. In the absence of India, Vietnam, Thailand, and Pakistan are striving to fill the gap. However, Pakistan has an advantage in terms of freight due to its proximity to buying countries in the Middle East, Europe, and Africa.

A Mumbai-based dealer stated that it is likely that India will reevaluate its export restrictions after the elections in May. Pakistani exporters have already shipped around two-thirds of the entire year’s shipments, and it is expected that they will sell the entire quantity before the end of May.

Kewlani also mentioned that Pakistani farmers are receiving record prices for their paddy, which is likely to encourage them to expand their planting areas in the next season. He believes that Pakistan will have a larger surplus for export in the coming season if weather conditions remain favorable.

(Source: [Marketscreener](https://www.marketscreener.com))