PRODUCTION OF RICE

S.KAMAL HAYDER KAZMI,
Research Analyst
, PAGE
Mar 9 - 15, 2009

Pakistan being an agro based economy has natural abundance of various agricultural products including food grains of which rice is an important food and cash crop cultivated on about 2.5 million hectares representing over 20% of the total cropped area (food grains) in Pakistan.

Pakistan comes in the top 5 rice exporting countries of the World. Although, the production of rice in Pakistan has remained static at around 5 million tons annually but the export earnings have increased twofold in the last 3-4 years from US$ 570 million to US$ 2.0 billion, which was only possible because of good perception of Pakistani rice in general and superiority of basmati in particular.

Pakistan is one of the main producers of the world's finest long rice. Basmati Rice, Super Kernel, Basmati Rice 385, Brown Rice and Parboiled Rice are the special types and forms of rice crops in Pakistan. In Pakistan rice prices continue to rise with non-basmati varieties witnessing the highest increase.

Rice Exporters Association of Pakistan (REAP) has been successful in improving the international trade volume of Pakistani rice by developing rice milling machinery locally and by importing latest technology and equipments from Japan, England, Europe, USA and Asia to modernize value addition.

CURRENT PRICES OF RICE
TYPES OF RICE WHOLESALE PRICE (RS PER KG) RETAIL PRICE (RS PER KG)
Super Dhamaka 110 115
Super Kernel Old 98 100
Super Kernel New 60 65
Ponam Rice 89 102
Super Chilghoza 90 95
Super Kernel Sela King Marka 72 75
Super Rice 86 New 36 40
Rice Aery 9 28 30
Super Rice 86 Old 42 45
Sela Taj Mahal 82 85
Sela Super New 55 60
Sela Daghi 50 55
Various sources

RICE EXPORTS

RICE EXPORTS
COUNTRIES JULY - AUGUST, 2008 JULY - AUGUST, 2007
  QUANTITY (TONES) VALUE (RS IN MN) QUANTITY (TONES) VALUE (RS IN MN)
U.A.E 73,030 6,792.41 75,971 2,959.23
Iran 50,992 5,251.04 23,759 613.51
Afghanistan 40,980 3,001.02 20,499 315.93
Oman 23,978 2,403.46 11,039 524.11
Saudi Arabia 24,945 2,339.16 9,351 359.58
South Africa 24,378 319.52 36,429 450.91
Qatar 12,069 1,020.30 8,841 303.98
Others 123,071 9,028.87 157,641 3,858.47
Total 373,443 31,154.49 307,641 8,960.33
Source: FBS

Currently, the Trading Corporation of Pakistan (TCP) plays a limited role in the rice trade by facilitating government-to-government exports. In August, 2008 rice exports fetched Rs. 13,021.52 million as against Rs. 18,132.97 million in July, 2008 and Rs. 4,606.44 million in August, 2007 showing a decrease of 28.19% over July, 2008 while an increase of 182.68% over August, 2007.

During July - August, 2008 its exports amounted to Rs. 31,154.49 million as against the exports of Rs. 8,960.33 million during the corresponding period of last year showing an increase of 247.69 percent. U.A.E was the leading buyer of rice during July August, 2008 with its share of 21.80% in the total exports of this item. Other major buyers were Iran (16.86%), Afghanistan (9.63%), Oman (7.72%), Saudi Arabia (7.51%), South Africa (4.23%) and Qatar (3.28%). These seven countries accounted for 71.02% of total rice exported from Pakistan during the period under review.

EXPORT RECEIPTS BY RICE
(Thousand US Dollar)
COMMODITY JANUARY (P) DECEMBER (R) JANUARY JULY-JANUARY
  2009 2008 2008 2008-09 (P) 2007-08
Rice 143,500 107,662 131,145 1,089,080 647,096
A) Basmati 85,945 60,273 71,551 755,220 443,774
B) Others 57,555 47,390 59,594 333,860 203,322
Source: SBP. P: Provisional, R: Revised

BUMPER PRODUCTION TO INCREASE EXPORTS

Rice is the major exports of Pakistan because our country earns substantial amount from its exports. The government is hoping that rice production for the current year in Punjab would be at least 13 to 15 % higher than that of last year, which would greatly help reduce the prices of the commodity in the country. Pakistan earned $1.88 billion through export of rice in 2007. While in the year 2007-08 high inflation rate affected the prices of inputs, which led to price hike of the commodity.

Owing to bumper crop this year, around one million tonnes of rice will be exported to the European countries. Last year the figure stood at 80,000 tonnes. The estimated target has been set as the demand from the European countries is increasing.

About 500,000 tones of rice would also be exported to African countries including Kenya (250,000 tonnes) during January-June 2009.

Kenya is the largest export market of rice in Africa. Pakistan has exported around 27,688 tonnes of rice to Kenya from 1 July to November 2008. Irri-6 is the main rice exported to Kenya. However, due to fall in staple prices in international market the price of Pakistani rice has also declined and price of basmati rice in international market decreased to $1,100 per tonne from $1,800 per tonne in June 2008.

Pakistan offers more competitive price of rice than India due to bumper crop and depreciation of the Pakistani rupee against the dollar.

CONCLUSION

Currently, the production of rice in Pakistan has remained static at around 5 million tons annually. However, export earnings have increased two fold in the last 3-4 years from $570 million to $2 billion. The government must look to enhance the production and improvement of quality of rice in order to maintain international image of Pakistani rice.

This is only possible through innovative campaign and efforts at all levels from the stage of growing, cultivation of rice to its husking, processing and milling to better marketing and achieving standardisation. REAP is determined to achieve rice exports target of $2.4 billion for 2008-09.