What’s Behind the Concern of Pakistan’s Rice Exporters?
Pakistan’s rice industry, despite record exports of $3.88 billion in FY24—up 78% from the previous year—is facing significant challenges.
India, which imposed rice export restrictions last year, is expected to lift these soon. With Indian stocks high and production set to increase, Indian rice could regain market share, impacting Pakistani exports.
The La Nina weather pattern is likely to boost rice production in the Asia-Pacific region, leading to higher global production and potentially lower prices. Bloomberg forecasts record rice production in 2024-25, surpassing global consumption and increasing inventories.
Additionally, Pakistan’s rice exports face rejection risks from the EU, UK, and US due to pesticide residues and mycotoxins. Pakistan has had 26 alerts for pesticide residues this year, compared to 44 in 2023, and 10 alerts for mycotoxins, up from two last year. This issue is compounded by a lack of awareness among farmers and inadequate staffing in the Department of Plant Protection.
The government’s proposal to shift to a new tax regime and rising production costs are adding to the industry’s woes. There is a call for the government to modernize farming practices, improve inspection processes, and adjust policies to support the rice sector. With these issues, Pakistan’s once-thriving rice export industry faces a critical period, and decisive action is needed to restore its competitive edge.
