Pakistan Agriculture storage and Supply Corporation (Passco) will start procurement of one million tonnes of rice from October 1, reliable sources from the Ministry of Food, Agriculture and Livestock (Minfal) told Business Recorder here on Friday.
They said that the government had started negotiations with the State Bank of Pakistan (SBP) to provide export refinance facility to the rice exporters. "In international market, the prices of rice have started decreasing. Just a week ago, the price of rice was 737 dollars per tonnes, while it is now being sold at 729 dollars per tonnes.
So, the rice exporters are seeking for the facility of export refinance from the SBP to absorb the surplus stock of rice to export to the international market after six months when the prices would start increasing," said the sources. "The rice output is expected to rise by at least 10 percent to over six million tonnes in the current fiscal," sources said.
On the other hand, the private rice exporters are demanding of the government to extend export refinance facility to the rice exporters to absorb the surplus rice stocks for six months.
Well-placed sources in the Food Ministry told Business Recorder that due to smart production of rice crop this year, the growers had been deprived of the profits they deserved as they were being paid just Rs 600 per 40 kilograms as against Rs 800 per 40 kilograms just two weeks ago. It is grown over 10 percent of Pakistan's total cultivated area. Rice is a highly valued cash crop and is also a major export item. It accounts for 6.7 percent in value-added in agriculture and 1.6 percent in the gross domestic product (GDP).
Two varieties of rice - Basmati, which is mainly grown in Punjab and Irri, which is grown in Punjab and Sindh - dominate the world market. Basmati accounts for two percent of exports and is of a higher quality than Irri.
According to a report issued by US Agriculture Department (USDA), Pakistan may export three million tonnes and Indian export will be 2.8 million tonnes in 2008. India's rice exports may further take a dip to two million tonnes in 2009, while Pakistan will raise its overseas supply to 3.15 million tonnes.
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