Price of rice

Pakistan, October 2023

Based on the latest news, the prices of Pakistani rice have undergone notable fluctuations due to various factors:
  1. Price Hike: Pakistani rice prices experienced a significant hike, nearly 90%, over the last year primarily due to devastating floods that wiped out nearly 1.9 million tons or 80% of the expected crop production in Sindh. This situation was exacerbated by an increase in the cost of production at both the farming and milling levels, making rice prices the second highest rising item in the inflation basket, following flour prices​1​.
  2. Price Decline: More recently, the prices of Paddy rice, particularly the Basmati 1509 variety, witnessed a sharp decline across Punjab, losing nearly Rs. 1,500 per maund within a month, as new crops started arriving in the markets. The decline was significant across various grain markets including those in Kasur, Sahiwal, Bahawalnagar, Jhang, Multan, Sheikhupura, Gujranwala, and Faisalabad, where prices dropped from Rs. 5,300 per maund to nearly Rs. 3,800 per maund​1​.
  3. Export Quotations: In May 2023, quotations for Pakistani rice exports (25% broken) rose to an average of USD 503 per tonne, marking an 11.0% month-over-month increase and reaching their highest level since August 2008 due to several interrelated factors including the 2022 floods, domestic price inflation, and consumer product substitution​2​.
  4. Export Performance: As of October 4, 2023, Pakistan exported 3.7 million tons of rice, valued at $2.5 billion, an increase from the same period in 2022. However, Pakistan's rice exports recorded a 48% decline globally due to Indian strategy of dumping the commodity in international markets at cheaper rates, which impacted the overall rice exports for Pakistan negatively​3​​4​.
  5. FOB Karachi Prices: As of October 13, 2023, the Free On Board (FOB) Karachi prices for Pakistani White Rice (5% broken) stood at $580 per metric tonne, and for Pakistan Long Grain IRRI 6 White Rice (Max. 5% broken) were quoted accordingly​5​.

The fluctuations in rice prices have implications for both local consumers and the global market, especially in light of the competitive pricing and export bans from India. While a decline in prices may provide relief for consumers and improve export prospects, it poses challenges for farmers and the broader agricultural sector in Pakistan.