Pakistan misses rice export target

KARACHI: Despite a massive increase in rice exports, the $3 billion export target could not be achieved in the year 2009-10. This led the Rice Exporters Association of Pakistan (REAP) to assert that the government was completely indifferent to the needs and demands of rice exporters.

Talking to reporters on Monday, REAP Chairman Malik Muhammad Jahangir highlighted that rice exports had increased from three million tons in 2008-09 to 4.6 million tons in 2009-10. Despite this 54 per cent increase in exports, the $3 billion target could not be reached because of frequent power outages and a fall in international prices.

“Power shortages have crippled the rice industry and its exports. The government is not allowing us to generate electricity on our own while electricity prices are constantly increasing,” Jahangir added.

Basmati exports were the worst hit by interruptions in supply and increasing cost of electricity. Talking to The Express Tribune, the Vice Chairman of REAP revealed that the 1.5-million-ton basmati export target for the year could not be met and only 1.05 million tons of basmati rice had been exported during 2009-10.

He explained that the target could not be met because rice processing factories were facing severe power shortages.

Even in terms of value, rice exports increased from $2.04 billion to $2.26 billion. However, this 11 per cent increase was much smaller than the growth in quantity of rice exported owing to a decrease in international rice prices.

The vice chairman emphasised that the rates non basmati exporters managed to get during the year were much lower than rates for basmati rice. On average, REAP exporters bagged $834 per MT for basmati and $393 per MT for non-basmati.

He also criticised the role of the Trading Corporation of Pakistan (TCP) and its policies that usually hinder the activities of rice exporters, such as the imposition of tax on rice exports.

When asked about the export target for the current year, Mr Suleman commented that a meeting is scheduled to be held on July 12 where the export target for 2010-11 will be approved.

He also shared plans of sending more delegations to Iran and Yemen, who were big buyers of Pakistani rice, in order to attract more business. REAP exporters were also looking to target the potential markets of USA and Europe in coming years. According to REAP, Pakistani rice was now being exported to 109 countries as compared to last year’s list of 76 countries.

Published in The Express Tribune, July 6^th, 2010.