Pakistan gains as India dilly-dallies on rice exports.

NEW DELHI: Even as India awaits the detailed second-stage monsoon report to decide on lifting long-standing ban on export of non-basmati rice, Pakistan may have gained at the former’s expense.

In fact, a clutch of decisions in the food sector have been kept pending by the Centre for quite a while in view of a persistently high food inflation level of over 16%.

These include, hiking wheat import duty and sugar import duty. Detailed regional and temporal forecasts are expected to allow the government to take timely decisions with the core objective of tempering consumer prices for food even while insulating farmers from distress.

A statement from the Rice Exporters Association of Pakistan (REAP) said that India’s continued ban has helped its rice exports, coupled with strategic price cuts in key markets. South Africa, Saudi Arabia and Dubai were the main buyers, while Pakistan was also able to sell more rice this year to Bangladesh and Sri Lanka.

Pakistan exported 3.65 mt of rice in the first ten months of the paddy marketing year up to April, 66% more than the same period last year. Exports of non-basmati rice rose more than 100% to 2.86 mt in the period. Thailand and Viet Nam were Pakistan’s main rivals in the non-basmati exports.

The statement read: “Our rice exports this year have been exceptionally good. By the end of June, our exports will touch the 4.5 mt mark”.

Pakistan’s exports in the 2008-09 marketing year totalled only 3mt. According to REAP, the move to slash prices by $10-12/tonne (compared to other key exporters) helped boost its exports in West Asian countries apart from Africa. The strategy worked by adding volumes, it said.

Out of the total exports, Pakistan exported about 800,000 tonnes basmati rice through April, compared to more than 774.119 tonnes over the same period in the previous year. India is Pakistan’s key rival in basmati exports.

Last week, farm minister Sharad Pawar ruled out lifting the ban on non-basmati rice exports, saying that it would jeopardise national food security at this juncture, especially due to the marked shortfall in rice procurement in kharif marketing sesaon 2009-10.

The ban on non-basmati rice exports was imposed in April 2008 in a bid to cool food inflation, now still at almost 17%, and domestic rice prices which have shot up by over 13% in the last eight months.

Rice procurement, so far, in the current year (October2009- September 2010) has been 28.6 million tonnes against 29.9 m.t in the year-ago period, due to a sharp fall in production caused by a widespread drought last year. The government procured a record 33.68 mt last year and expects this year’s to be 30 mt.

Source : The Economic Times