Production:

Rice is Pakistan's third largest crop in terms of area sown, after wheat and cotton. About 11 percent of Pakistan's total agricultural area is rice during the summer or "Kharif" season. Pakistan is a leading producer and exporter of Basmati and IRRI rice (white long grain rice). Rice ranks second among the staple food grain crops in Pakistan and exports are a major source of foreign exchange earnings. Pakistan grows a relatively high quality of rice to fulfill domestic and export demand. Rice accounts for 2.7 percent of the value added in agriculture and 0.6 percent of gross domestic product. Pakistan has two major rice-producing provinces, namely Punjab and Sindh. Both provinces account for more than 88 percent of total rice production. Punjab, due to its agro-climatic and soil conditions, is producing 100 percent of the Basmati rice in the country. Pakistan's "Kalar" bowl area, a local term that refers to a type of soil suitable for Basmati production, is famous for producing Basmati rice and is located between the Ravi and Chenab rivers in Punjab. IRRI rice is grown in both Punjab and Sindh.

MY 2015/16 rice production is forecast at 6.9 million tons, unchanged from the current year's updated production. Area is not expected to change from the revised official 2014/15 estimate as prices for all summer crops have declined and farmers are not expected to shift to other crops. Yield is forecast at 3.6 tons per hectare, a good yield, but not a record. MY 2014/15 production is also adjusted upwards to 6.9 million tons, in accordance with Government of Pakistan figures, tying the previous record rice production level. The rise in production is mainly due to an increase in area and the deposit of a nutrient rich top layer of soil as a result of successive floods in recent years. After the 2014 monsoon floods in September, there was a growing fear that rice crop would be adversely affected as rice fields especially in the basmati growing areas. The increase in production suggests that the initial flood damage reports were exaggerated and the rice crop actually benefitted from the floods.

Rice in Pakistan is a monsoon crop but the introduction of hybrid varieties in recent years has influenced the timing of sowing and transplanting. Hybrid varieties are sown as early as March and April instead of June and July. However, sowing timing is heavily influenced by the extent and spread of monsoon rains, and the availability of underground and irrigated water. Irrigation water is mostly sourced from the runoff of the Himalayan glacier melt into the Indus river basin, so temperatures during the months of May and June are critical in determining the season's water availability.

Rice Growing areas of Pakistan are broadly classified into following four zones;

Zone I

Northern high mountainous areas of KPK (Swat and Khagan) with sub-humid climate, average rainfall of 750-1000 mm

Zone II

Lies between the Ravi and Chenab rivers in the central Punjab. Sub-humid, sub-tropical climate with average rainfall of 400-700mm. This is the famous premium zone and Basmati rice is exclusively produced in this zone along the Kalar tract consisting of Sailkot, Sheikhupura, Narowal, Gujranwala, Hafizabad and Lahore Districts

Zone III

West bank of Indus river in upper Sindh and Balochistan. Larkana, Jacobabad (Sindh), Nasirabad and Jaffarabad (Balochistan). High temperature and sub-tropical climate with average rainfall of 100 mm make it best suited for medium long rice.

Zone IV

Indus delta basin in Lower Sindh (Badin and Thatta Districts). Its climate is arid tropical and is suited for coarse varieties.

Consumption:

MY 2014/15 consumption is adjusted upwards at 2.8 million tons and MY 2015/16 consumption is forecast at 2.9 million tons. The slight increase in consumption is due to better availability as a result of higher stocks. Unlike many other Asian countries, rice is not considered a staple food crop in Pakistan. Traditionally, 40 to 45 percent of the crop is used for local consumption, with the balance exported. Pakistanis, in general, prefer the higher priced Basmati rice if they can afford it, if not they consume long grain IRRI rice, but wheat is the favored staple. In 2014, domestic rice prices displayed a downward trend and the price of rice in December 2014 was four percent lower than in December 2013 mainly due to higher stocks. According to trade sources an estimated 200,000 tons of 40-100 percent broken rice is used in poultry and animal feed annually.

Trade:

Pakistan's MY 2013/14 rice exports are adjusted downwards at 3.2 million metric tons in accordance with the most recent Pakistan Bureau of Statistics data. While this estimate is subject to revision, it generally mirrors the consensus among market observers in Pakistan. While MY 2014/15 exports are off to a good start, exports are now expected to reach just 3.7 million metric tons for the year due to weaker export demand especially for Basmati exports. Pakistan's exporters are concerned about China's import quota on Pakistani rice and Kenya's recent decision to hike its rice import tariff significantly. 2015/16 exports are projected at 3.8 million tons due to higher exportable supplies and an increase in production. Pakistan's rice exports during the current marketing year are provided below in table, this data may be subject to eventual revision.

Pakistan Rice Exports MY 2014/15 (Nov/October)

Month

Metric Tons

November

459,419

December

490,371

January

419,153

February

355,747

Total

1,724,690

Rice is a major Pakistani export to the United States. Out of $118 million in Pakistani agricultural products exports to the United States in 2014, rice exports comprised $37.5 million (32 percent of the total). This was the highest ever Pakistani rice exports to the United States.

Stocks:

MY 2014/15 ending stocks are forecast at 1.8 million metric tons while MY 2015/16 ending stocks are projected at 2.0 million metric tons. Pakistan's previous highest stock levels were around 1.4 million metric tons, making these forecasts successive records. Rice millers are concerned about the large stocks at their mills, citing less than expected purchases from exporters and significant carrying costs. The higher level of stocks is mainly due to successive good harvests and a declining basmati exports which are due in part to strong competition from India. According to trade sources, basmati stocks exceeded 1.0 million metric tons at the close of the 2013/14 marketing year.

Policy:

Rice trade in Pakistan is carried out by the private sector with little or no intervention from the government. Since the publicly-run Rice Export Corporation of Pakistan was disbanded 20 years ago, Pakistan's rice traders have responded well to market liberalization and over the years have become major players in world rice trading. The milling industry made significant investments in state-of-the-art processing machinery, but Pakistan exports most of its rice in bulk with no modern packaging and branding. Export companies could be doing more to develop brands and a more significant presence in foreign markets. However, the export industry is comprised of a large number of relatively small firms that are often family-run and accustomed to traditional trading practices. However, that is changing and Pakistan's rice exporters are becoming increasingly active advocates for their industry and their trade interests. With time, the industry is expected to adopt more strategic and brand-based approaches to rice exporting.

Rice, Milled

2013/2014

2014/2015

2015/2016

Market Begin Year

Nov 2013

Nov 2014

Nov 2015

Pakistan

USDA Official

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USDA Official

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USDA Official

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Area Harvested

2,760

2,780

2,760

2,850

0

2,850

Beginning Stocks

500

500

1,200

1,400

0

1,800

Milled Production

6,700

6,700

6,500

6,900

0

6,900

Rough Production

10,051

10,051

9,751

10,351

0

10,351

Milling Rate (.9999)

6,666

6,666

6,666

6,666

0

6,666

MY Imports

30

0

30

0

0

0

TY Imports

30

0

30

0

0

0

TY Imp. from U.S.

13

0

0

0

0

0

Total Supply

7,230

7,200

7,730

8,300

0

8,700

MY Exports

3,400

3,200

3,900

3,700

0

3,800

TY Exports

3,400

3,200

3,900

3,700

0

3,800

Consumption and Residual

2,630

2,600

2,700

2,800

0

2,900

Ending Stocks

1,200

1,400

1,130

1,800

0

2,000

Total Distribution

7,230

7,200

7,730

8,300

0

8,700

Yield

3.641

3.615

3.533

3.631

3.631

1000 HA, 1000 MT, MT/HA