Pakistan reported a record $3.88 billion in rice exports for FY24, marking a 78% increase from the previous year. Despite this achievement, the industry is not celebrating due to numerous challenges that have compounded the existing market volatility.
Firstly, India is expected to ease restrictions on its rice shipments, which significantly contributed to Pakistan’s record exports last year. India had banned exports of broken rice in August 2022 and imposed duties on non-basmati white rice. This was followed by a ban on non-basmati rice exports in July 2023 and further restrictions on basmati and parboiled rice in August.
These restrictions were implemented due to rising domestic inflation in India ahead of an election year. However, the ruling party saw less-than-impressive results in the general elections and now faces challenging state assembly polls later this year in Haryana and Maharashtra, both states with strong farm lobbies.
Media reports indicate that Indian rice stocks are three and a half times the required target, with S&P Global forecasting record production for the upcoming year due to the La Niña weather system expected by August. These factors are fueling expectations that India will lift its restrictions in the coming weeks or months, potentially regaining the market share that Pakistani exporters have acquired.
