Research Analyst
Oct 11 - 17, 2010

Rice is the Pakistan's third biggest crop after wheat and cotton and contributes around 1.6 per cent to the GDP. Rice accounts for 6.4 per cent of value-added in agriculture and 1.4 per cent in GDP. Pakistan grows high quality rice to meet both the domestic demand and exports. It is grown over 10 per cent of the total cropped area. Different varieties of rice are grown in Pakistan like Super Basmati, Basmati PK-385, Irri-6, Irri-9 and KS-282 etc. Two varieties of rice dominate the market: Basmati and Irri that are mainly grown in Punjab and Sindh. Basmati accounts for two per cent of exports and is of a higher quality than Irri.

Rice Exporters Association of Pakistan (Reap) has been successful in improving the Pakistan rice trade by the development of rice milling machinery locally and importing latest technology and equipments from Japan, England, Europe, USA, and Asia to minimise losses and value addition.


UAE 316,142 18,851.55 257,555 19,800.37
Iran 206,573 10,840.82 303,082 24,166.30
Kenya 281,698 8,921.65 139,248 4,381.98
Afghanistan 193,514 8,407.25 280,160 15,851.86
Saudi Arabia 148,488 8,291.43 120,947 8,658.93
Philippines 177,741 6,908.20 6630 396.90
Sri Lanka 151,834 5,614.37 6845 469.16
Others 1,947,623 84,006.68 1087484 56,662.07

During April 2010 rice exports fetched Rs15,882.54 million as against Rs21,619.74 million in March 2010 and Rs12,731.23 million in April 2009 showing a decrease of 26.54 per cent over March 2010 and up by 24.75 per cent over April 2009. During July-April 2010, its exports amounted to Rs151,841.95 million as against the exports of Rs130,387.57 million during the corresponding period of last year showing an increase of 16.45 per cent. UAE was the leading buyer of rice during July-April 2010 with its share of 12.42 per cent in the total exports of this item. Other major buyers were Iran (7.14 percent), Kenya (5.88 percent), Afghanistan (5.54 percent), Saudi Arabia (5.46 percent), Philippines (4.55 percent) and Sri Lanka (3.70 percent). These seven countries accounted for 44.67 per cent of total exports of rice during this period.

Unit price of rice basmati for April 2010 was Rs70,127.87 per tonne as against Rs69,275.67 in April 2009 showing a rise of 1.23 per cent. Average unit price of this variety for July-April 2010 was Rs70,109.78 per tonne as against Rs91,020.04 for the same period last year showing a fall of 22.97 per cent. Unit price of rice "other varieties" increased to Rs34,374.87 per tonne in April 2010 from Rs31,283.96 in April 2009 showing a rise of 9.88 per cent. The average unit price of rice "other varieties" for July-April 2010 of Rs35,803.08 per tonne was lower by 14.69 per cent compared to average unit price of Rs41,970.78 per tonne for the same period of last year.

Rice was the second largest crop affected by the floods. The damage to the rice crop is estimated at about Rs56.3 billion and it is expected that the rice production would decline by 29 per cent to 4.352 million tonnes as against the target of 6.176 million tonnes. The floods have mainly affected Irri-6 paddy growing areas. Rice paddy was sown on 2.64 million hectares and damaged area is 0.708 million hectares or 1.7 million acres.

Rice exporters estimate that production of non-basmati rice will fall short by 15 to 20 per cent from the previous estimate. Low-income groups mostly use Irri-6, Irri-9 and 386 varieties. Rice occupies 2.6 million hectares that is 10.9 per cent of the total cultivated area with production of 5.1 million tonnes of milled rice.

According to the World Bank, flood damaged crops worth one billion dollar. However, this figure will surely increase and final estimates of the losses to essential cash crops like rice, cotton, tobacco and sugarcane might exceed to three billion dollar.

A US Department of Agriculture report indicated that rice production in Pakistan would be about 4.4 million tonnes for 2010-11 and the rice export is estimated at 2.3 million tonnes.

It was expected that non-basmati rice production would be about 4.5 million tonnes in the current year but due to floods in various parts of Sindh, where much of this kind of rice is grown, the expected loss is 800,000 tonnes.

Basmati rice is grown in Punjab and most of the areas have not been affected significantly by the floods. Because of supply constraints, the price of basmati rice has increased by Rs10 to Rs70 per kg in wholesale markets while rates of non-basmati rice have risen by Rs5 per kg. The price hike was due to the Indian government's ban on export of non-basmati rice, while the prices have increased as intermediary is holding back stocks.


Despite a shortfall of about 1.5 million tonnes in rice production due to devastating floods, Pakistan will be able to export rice worth $2 billion during FY11. Moreover, Pakistan has about 0.8 million tons of milled rice worth $800 millions as a carryover of the previous crop. The demand of Pakistan's superior quality basmati rice is picking up in the international market at a rate of $1050 to $1100 per ton.