Pakistani rice losing steam

When India made a re-entry in the non-basmati export market back in November 2011, no one was expecting its unreliable and whimsical export policies to wreak any kind of lasting damage on the Asian rice bloc. But six months later, the rice producing giant was shipping out more of the staple grain than any other country in the world.
Over the last two years, successive years of bumper rice crops, rising minimum support prices, and a massive central storage system that allows the domestic rice market prices in the country to stay buoyed have thus allowed India to wreak havoc on the competition. And Pakistan is one of the biggest parties to have been steam-rolled in the ensuing chaos.
The country’s total exports of rice during Jul-May FY13 stand around 2.83 million tons, down about 16 percent compared to the same period of the previous fiscal. Of these dispatches, export of non-basmati white rice varieties were down by nine percent while the Basmati shipment took a massive whipping, shedding nearly 38 percent in tonnage.
Although the year saw Pakistani rice find greater patronage in China, the country’s exporters have been consistently struggling against Indian competitors in other destination markets. The loss of the Iranian market has been one blow that needs special mention in this scenario.
Disturbingly, this fall in export of Pakistani rice is highly attributable to erosion in the international demand for Basmati rice.
According to PBS data, Pakistan exported 2.32 million tons of non-basmati rice during July–May FY13; down about nine percent from the same period of FY12. But in terms of value, exports of non-basmati rice earned Pakistan about $1.27 billion during the same period, which was up about eight percent from around $1.18 billion earned during the aforementioned period.
Meanwhile, basmati exports during 10MFY12 stand around 514,508 tons, down sharply by 38 percent compared to the same period of the previous fiscal. In terms of value, basmati exports during the same period have earned the nation about $544 million, down about 26 percent compared to FY12.
The reasons for this are two-fold; rising competition from India and declining yields in Pakistan. According to official data, area under aromatic and long-grain basmati paddy in Punjab, which accounts for over 90 percent in its national production, has shown a decline of 34.5 percent between FY09 and FY13.
BR Research had highlighted the declining trend last year. And one year on, the low sowing (especially of the Super Kernel variety) has resulted in a less than stellar crop and a massive slide in exports of the hitherto highly sought after rice varieties of the country.