Poor logistics hurting potato exports

Total potato production for the year is estimated to be 2.3m tons and with domestic consumption around 1.6m tons.


Naeem Ullah February 16, 2011

LAHORE: Pakistan’s potato exports are lagging behind compared to regional competitors, as a result of poor logistics in the country, exporters say.

Total potato production for the year is estimated to be 2.3 million tons and with domestic consumption around 1.6 million tons, 0.7 million tons are likely to be exported to East Asia and Russia, which can bring up to Rs15 billion in export revenue.

Exporters approached by The Express Tribune said that potato exports are subject to availability of refrigerated containers. Exports from Pakistan are suffering due to poor logistics, as land transport is costly for traders and unavailability of containers has worsened the situation.

Exporters said that supply to Russia and Central Asian Republics (CARs) required at least 15 days and non-refrigerated containers could not preserve potatoes for so long.

Traders exporting potatoes to Russia and CARs were dependent on Iranian companies for refrigerated containers, which were being provided to exporters on the Pak-Iran border. “Hence, exporters’ dependency on Iranian transporters has raised the transport cost and caused delay in delivery to the targeted markets,” said an exporter.

Problems are also faced at the sea port, where most shipping companies are busy with export of onions and oranges. Exporters were unable to strike deals with shipping companies, which were not prepared to export potatoes to Sri Lanka, Malaysia and other East Asia countries.

The undersized potato export levels have provided India and Bangladesh an opportunity to exploit markets that were dominated by Pakistan.

Potato exporter Aslam Pakhali said that unavailability of refrigerated containers and the costlier export mechanism encouraged regional competitors such as India and Bangladesh to export to markets Pakistan had targeted. He added that Bangladesh and India provided significant subsidies on invoice value to exporters and urged Pakistan government to follow suit.

Abdul Waheed, another exporter, explained that present circumstances had resulted in Pakistani exporters failing to take advantage of high demand in Russia after a drop in production there. He asked the government to facilitate potato exports by ensuring supply of containers, so that export targets could be met and greater revenue could be generated.

Published in The Express Tribune, February 16th, 2011.

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