Pakistan may lose over $4.5 billion in export revenue if the government fails to provide a mechanism to export surplus 5.3 million tons of rice. Official sources told Business Recorder that Pakistan is expected to have a bumper paddy crop, of 6.3 million tons, during the current season 2009-10.
Domestic requirement of rice is only 2.5 million tons, and Passco has a carried over stock of 1.5 million tons rice from last year. After meeting domestic needs, the country would have a surplus stock of around 5.3 million tons exportable rice. At present, there is an average price of $350 to $360 per ton for Irri-6 in global market.
Pakistan earned around $2 billion foreign exchange from 2.5 million tons of rice exports last year. "At present, the government lacks an aggressive strategy for disposing of the huge stocks of rice and the government should evolve a dynamic plan for exporting surplus rice immediately, which could earn sufficient foreign exchange for the country to enable it to reduce our dependency on foreign aid," sources said.
Pakistan has huge potential of rice exports as Iran and Afghanistan are keen to import from Pakistan to replenish their stocks, but no sincere efforts on the part of the government have been made so far. "Other major consumers of Pakistani Basmati rice are the oil rich states of Gulf and Middle East and we can increase our rice export to these countries too", sources added.
"We managed to make a breakthrough in new markets including Iran which in the past was reluctant to purchase Pakistani rice. Similarly, Iraq, Thailand and Philippines are new markets for our rice," one market source said and urged the government to devise a comprehensive plan to export rice.
He stressed that there is urgent need for government involvement in exploring and opening up of Malaysian and Indonesian markets which normally prefer to import huge quantities of rice from other Asean member states because of proximity and advantage of lower freight charges.
However, he said that Pakistan, being the largest importer of edible oil from Indonesia and Malaysia, could exert pressure on them to open market for barter trade of Pakistani rice with their palm oil. Pakistan presently imports around 1.3 million tons of palm oil from the two countries for around $900 million per annum. "Indonesia imports around 1.3 million tons of rice and Malaysia around one million tons annually and they should give some market share to Pakistan, their biggest palm oil buyer," he added.
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