Traders challenge likely rice export ban with stock stats

KARACHI: Exporters on Tuesday said a ban on rice exports in a bid to avoid a possible shortage would be unnecessary as well as unjustified as huge stocks of this grain were available in the market, while sowing for the next crop was around the corner.

This year (2019-20) Pakistan produced around 7 million tons of basmati and non-basmati rice, of which 2 million tons are consumed locally, 4 to 4.5 million tons are exported legally, while 0.5 million tons are traded unaccounted.

“A lot of rice is available in the market and by next month, growers will sow paddy for the next season,” Rafique Suleman, a rice exporter and leader of Rice Exporters Association of Pakistan (REAP) told The News.

“Around 1.5 million tons are lying with exporters, while a bulk quantity is also available for local sale. Due to Iran-Pakistan border closure, a lot of stocks of basmati and super basmati are also available,” Suleman said.

He said an increase of 15 percent in the prices was seen in the local market during last couple of weeks, which was largely an impact of 8.5 percent depreciation in rupee against the US dollar.

“Since most of non-basmati rice is exported, any currency depreciation affects its price,” the REAP official said. “Besides, due to lockdown, a sudden increase in the demand by households, private welfare organisations, and government affected the prices. Once lockdown is over, prices will come down.”

He said that there was no shortage of rice and the commodity was available at every shop. “If it disappears from shops, then it will be called shortage,” he said. Exporters have also rejected a Sindh government proposed ban on rice exports.

Sindh Chief Minister Syed Murad Ali Shah, in his coronavirus situation review video-meeting with Prime Minister Imran Khan on Monday, suggested a ban on export of wheat, pulses, and rice.

Shah said food items should not be exported, as no one knew about the upcoming crop in the country and demand in the local market.

Suleman said a ban on rice export would be dangerous for not only rice industry employing 1.5 to 2 million workers abut also millions of growers.

“Rice is not our staple food. Our staple food is wheat. Some people eat rice occasionally, and some people even don’t eat rice,” he said.

He said every year Pakistan’s rice harvest was almost 4.5 to 5 million tons surplus and an export ban would prove disastrous for millions of people and the country ran the risk of losing a big chunk of foreign exchange.

“If any coercive decision is taken this time, it will affect negatively and growers will not sow paddy, as it is mostly an export commodity,” he said.

The rice exporter said due to international crisis, some export orders were cancelled from Europe while some buyers had delayed the payments.