However, rupee depreciation during the past two years has helped resurrect basmati volumes, with full year FY19 performance recording twenty percent growth over the previous year. Recovery of basmati export from levels last seen before the turn of the century has set in expectations of a rebound.

But it may be worthwhile to ask if the optimism is reasonable.

Back in 2000s, Pakistan’s basmati exports’ growth trajectory closely followed growing demand in the international market, with export volumes trailing global price trends. This continued until FY08, when prices first crossed the thousand dollars per ton barrier, with highest annual volume also clocking in during the same year.

During the three subsequent years, basmati price in the global market saw a roller-coaster ride, with prices briefly crossing $1,100 per ton, and Pakistan’s peak basmati exports of 1.2million tons also clocking in during the same year.

But it appears that another development during the same period reversed the trajectory of basmati export potential forever. In FY11, price differential between Irri-6 to basmati variety fell to just 1.68 times from a peak of 2.9 times in FY01, averaging at 2.50 times for most of mid-2000s.

Growing global demand for basmati had coincided with overall peak rice prices internationally, increasing margin on the low-value Irri-6 and Irri-9 varieties. The following years saw decline in basmati acreage from over 1.5 million hectares to under a million hectares in the country, even as overall acreage under paddy continued to grow, making rice the largest kharif crop ahead of cotton at close to three million hectares total by FY18.

And where did acreage under rice had marked gains? Consider that between FY11 and FY18, rice acreage in Sindh grew from 0.36 million hectares to over 0.8 million hectares. Sindh’s rice belt, which is thoroughly non-basmati territory, also enjoyed the added benefit of proximity to seaport.

Little surprise then that during the seven years since Pakistan’s peak basmati moment, Irri-varieties primarily of Sindh origin have recorded an annual CAGR volume growth of eight percent, at the same time as basmati has struggled to keep its head above water.

While cultivation of export-oriented rice in Punjab’s basmati bowl of Gujranwala changed gears circa FY13, export volume has failed to show potential. As the country lost its price advantage to neighbouring India, Pakistan’s basmati has turned primarily domestic market oriented, with less than one-fifth of total output being exported. At the same time, close to three-fourths of overall other category (including Irri- and broken rice) is exported annually, most of which continues to be grown in Sindh.

Considering the premium attached to geographical origin of Punjab’s basmati, especially in export markets such as EU; it is hard to imagine whether the variety will ever be able to regain its lost sheen, unless major leaps are made in yield and cost of production declining substantially

Pakistan’s basmati needs a revival. But it will require more than just rupee depreciation to regain foothold in export markets.

Source: Price – amis.pk; Export volume: PBS – 8 digit data; Acreage: Agricultural Statistics of Pakistan