The rice exports have come to a complete halt and no shipment was made since Friday following the agreement of Rice Exporters Association of Pakistan (Reap) with Ministry of Commerce and Ministry of Food, Agriculture and Livestock (Minfal).
Under the agreement, every rice exporter has to supply rice equal to his exports to the Utility Stores Corporation of Pakistan for local consumption. The rice exporters refused to accept mandatory condition of rice supply to Utility Stores and stockpiles for government to get quota for rice exports.
Following the decision of fixation of minimum export prices (MEP) of rice by Ministry of Commerce, Rice Exporters Association of Pakistan (Reap) through its "notice to trade" circular No 1831 dated May 2, 2008 has restrained its members from exporting rice against all old and pending sale contracts agreed between sellers and buyers on payment modes ie Documents against acceptance (D.A), Delivery of documents against payment (D/P) and Cash against documents (CAD) trade terms largely in practice for exports from Pakistan.
The Reap move created panic amongst rice exporters although there were no such restrictions from Ministry of Commerce or State Bank of Pakistan. Another notice of Reap bearing reference No 1832 of same date has further augmented anger of already irritated trade members, who were informed not to export their cargoes until further notice and all rice consignments lying pending at port since May 1, 2008 shall be treated postponed.
These two circulars of Reap have halted rice exports depriving country huge valuable foreign exchange, which at the moment Pakistan can not afford to mislay. Since May 2, 2008 rice exports are in doldrums.
Late news from ports clearing agents revealed that customs authorities have issued directives not to accept entries of export shipping bills through PACCS "CARE SYSTEM" and manual system till issuance of new export mechanism, which yet to be designed by REAP and TDAP.
They alleged Reap office bearers move is aimed at eliminating small and medium size rice exporters. They said these big wigs have planned to monopolise trade both at domestic and export markets.