Record high exports of rice from Pakistan driven by global demand
Published on: February 7, 2024.
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Global Appetite for Rice Drives Pakistan Exports to Record High
The year ending in June is expected to see a record high in rice exports from Pakistan as India’s decision to restrict its own shipments forces buyers to turn to Islamabad. The record exports will help alleviate tight supplies following India’s restrictions last year and will also boost Pakistan’s foreign exchange reserves. Rice exporters from Pakistan are predicting a jump of 60% in basmati rice exports this year to 950,000 tonnes.
Boost for Foreign Exchange
The restrictions imposed by India, the world’s largest rice exporter, have had a significant impact on global rice trade. In response, Pakistan has seen a surge in demand in recent months. Chela Ram Kewlani, Chairman of Rice Exporters Association of Pakistan (REAP), stated, “We’ve seen a solid demand for rice in the last few months, mainly because India stopped exporting.”
Pakistan’s rice exports in the year 2023-2024 could reach five million metric tonnes, up from 3.7 million tonnes the previous year, according to Kewlani. Some industry officials are even more optimistic, suggesting exports could reach 5.2 million tonnes due to improved production. Higher production and elevated global prices have allowed Pakistan to export rapidly, with around 700,000 tonnes of rice exported in December alone.
Basmati Rice Exports
Pakistan’s basmati rice exports are expected to increase by 60% this year to 950,000 tonnes. Non-basmati exports are also set to surge, potentially reaching 4.25 million tonnes, a 36% increase. In terms of value, rice exports from Pakistan could generate over $3 billion this year, up from $2.1 billion the previous year.
Market Dynamics
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 rising prices despite higher production. Pakistan currently exports non-basmati rice to countries such as Indonesia, Senegal, Mali, Ivory Coast, and Kenya, while premium basmati rice is exported to the European Union, Qatar, and Saudi Arabia.
Pakistan’s proximity to buying countries in the Middle East, Europe, and Africa gives it a freight advantage over competitors like Vietnam and Thailand. However, Indian exporters are expected to review their export curbs after elections in May. Pakistani exporters have already sold around two-thirds of the year’s shipments and are expected to sell the entire quantity before May-end.
In conclusion, Pakistan’s rice exports are benefiting from India’s restrictions, with a record high expected this year. The surge in demand and prices is providing a welcome boost to the country’s foreign exchange reserves.
Source: Eastern Eye
