Rice Exports Reach 16-Year High Prices
Published on: February 3, 2024.
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Pakistan Rice Exports Set to Reach Record High as India Cuts Shipments
Pakistan’s rice exports are expected to reach a record high in the current financial year, boosted by rival India’s decision to reduce its own shipments. This has led buyers to turn to Pakistan, which is offering rice at nearly 16-year high prices. The increase in exports will help ease tight supplies caused by India’s restrictions, the world’s largest rice exporter. Additionally, it will bolster Pakistan’s foreign exchange reserves, which are crucial for financing imports.
According to Chela Ram Kewlani, Chairman of the Rice Exporters Association of Pakistan (REAP), there has been a strong demand for rice in recent months due to India’s export ban. Kewlani predicts that Pakistan’s exports could reach 5 million metric tonnes in the 2023/24 financial year, up from last year’s 3.7 million tonnes. Some industry officials are even more optimistic, suggesting that exports could reach 5.2 million tonnes, given the significant improvement in production this year.
Pakistan’s rice production is expected to rebound to 9 to 9.5 million tonnes in 2023/24 after falling to 5.5 million tonnes last year due to floods. Higher production and elevated global prices are allowing Pakistan to export at a rapid pace. In December alone, Pakistan exported around 700,000 tonnes of rice.
Basmati rice exports are projected to jump 60% this year to 950,000 tonnes, while non-basmati exports could surge 36% to 4.25 million tonnes. In terms of value, Pakistan’s rice exports are estimated to exceed $3 billion this year, up from $2.1 billion the previous year.
Traditionally, India offered non-basmati rice at a lower price than Pakistan. However, with India out of the market, buyers are turning to Pakistan, leading to gradually rising local prices despite higher production. Currently, Pakistan is offering 5% broken white rice at around $640 per tonne and parboiled rice at around $680 per tonne, up from $465 and $486 respectively a year ago.
Pakistan primarily exports non-basmati rice to Indonesia, Senegal, Mali, Ivory Coast, and Kenya, while premium basmati rice is exported to the European Union, Qatar, and Saudi Arabia. In the absence of India, Vietnam, Thailand, and Pakistan are trying to fill the gap. However, Pakistan has a freight advantage due to its proximity to buying countries in the Middle East, Europe, and Africa.
It is expected that India will review its export curbs after the elections in May. Pakistani exporters have already shipped around two-thirds of the year’s shipments, and they are expected to sell the entire quantity before the end of May. The current record prices for paddy in Pakistan are likely to encourage farmers to expand their planting area in the next season.
Overall, Pakistan’s rice exports are flourishing due to India’s reduced shipments. With rising production, the country is meeting the demand and benefiting from higher global prices. Pakistan’s proximity to key markets and its attractive pricing are giving it an edge in the export market. It remains to be seen how India’s export policies evolve after upcoming elections, but for now, Pakistan’s rice industry is thriving.
Source: [The Express Tribune](https://tribune.com.pk)
