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Analysis of Rice Industry

Research Report

In sindh rice is cultivated in Larkana . rice is the second largest foreign exchange for the Pakistan.About 40% of total production of rice procured for the export and rest is consumed id local market. The entire research conducted under the guidance of MADAM QUARATULAIN KAZMI.22 million tons per year. Executive Summary In this project we have collected the data the data of rice industry and its contribution in the Economy of the PAKISTAN. Introduction Rice is the most widely consumed staple food at the global level and is an excellent source of compound carbohydrates. About 1. Shikarpur . (RECP). And rice is cultivated almost every area of the Punjab. 2|Page . Pakistan is 4th largest exporter and 11th largest rice producer on the world. Thatta and Jacobadad etc. We have take our data from the internet and then interpreted in to own words. It is for this reason that the Government of Pakistan. Dadu .544 million hectors with an average of 2.In this year Punjab has produce about 19 million tons. And it contributed almost 20% of the total foreign exchange of the Pakistan. About 5 million acres of Pakistan is covered by the rice and it produce almost 6. MUSSADIQ AND NAZIR. has completed an extensive quality assessment of exportable varieties of rice to keep up its status and distinction in the world market. Annually its production is about 3 million tons per year. through the rice export corporation of Pakistan LTD. Pakistan is the third biggest rice in the world after Thailand and the USA . After cotton largest foreign exchange earner. Badin .Analysis of Rice Industry ACKNOWLEDGEMET The report is prepared by AMMAR. One of the important crops of Pakistan is rice.461 million tons is produces in the province of sindh from an area of 0.686 tons rice per hector. This is recorded that as the highest foreign exchange earner of Pakistan.

one of the leading Basmati Rice exporters of Pakistan. At Alfarid. AFC is positioned to remain a leader in the commercial exports of rice. Pakistan. 3|Page . medicinal herbs. Through our established relationships. crude drugs. which are best suited to grow pure and genuine Basmati Rice because the company believes in bringing premium quality rice for its customers. our pledge to excellence is unparalleled and our commitment to continually exceed the expectations of our partners. Our management is persistent with respect to the deals it undertakes and gives every trading partner the individual attention required to build a successful trading relationship.alfarid. Alfarid Corporation currently holds a premier and reputable position in promoting the agro produces of Pakistan. vast resources and continued dedication to set the industry standard. seeds. clients. Nonetheless.Analysis of Rice Industry Introduction & History Of Rice Companies: Alfarid Corporation Limited (AFCL) http://www.html Established as a trading agency in 1972 in Karachi.org/about. suppliers and employees is unwavering. What sets us apart from other manufacturers is our emphasis on building strong relationship with our customers and targeting our efforts around the customer need. botanical plants and various other agro-based products of Pakistan.com/ Bahoo Rice Mills (BRM). BAHOO RICE (BRM) http://www. dried fruits.bahooricemills. we are confident that your company will find Alfarid Corporation to be an ideal match for your operation‟s supply needs. With over three decades of experience. has grown into an organization which is recognized for its remarkable performance and supply of high quality rice to the customers. Bahoo Rice Mills brings you Basmati Rice from the lush green and water filled fields of (Punjab) Pakistan. importing medicinal herbs to support the inland requirements of the pharmaceutical and the beverage industries also falls within the Company‟s profile. spices. Our aromatic rice includes Super White Basmati Rice and Parboiled Super Basmati Rice.

and retailers around the world. enabling businesses to sell more sustainable rice. 100 tones per day of high quality basmati rice. and their personnel highly specialised. The company is one of the leading exporters of Super Basmati Rice in Pakistan. a premier group involved in business since 1913. more profitably. AL FAIZAN http://www. At present we have production capacity of 4 tonnes per hour i.Analysis of Rice Industry We are serving international customers and exporting premium quality white Basmati and Parboiled rice to European and Middle East countries.pk/ AFC is the company designed to supply Best quality rice from Pakistan to the Rice importers. AFC offers a selected range of Basmati and non-Basmati rice varieties to create trust between rice vendors and their customers. quality control. Barkat Rice Mills is a Limited Company incorporated in the year 1999 under Pakistan Companies Ordinance 198. These are indispensable conditions to ensure that the quality of the rice that come from AFC is of the highest level Barkat Rice Mills Barkat Rice Mills is a project of FSL Group of companies. because prime importance is given to quality as "Quality is our motto". Extremely delicate raw materials are processed in the Al-Faizan rice processing mill.rice. AFCjoins business with leading rice importers of the world. 4|Page . inspection. Environmental and Food Safety Management Systems. Pak Rice Village Our state of the art manufacturing plant is located at Karachi often referred to as the rice bowl of Karachi is known worldwide as high quality basmati rice producers and Indian rice exporters.e. The plant has the latest & most sophisticat machines incorporating world class technology for the production. storage & transportation of basmati rice. therefore the processes used are technologically very advanced. Barkat Rice Mills is awarded the following Quality. distributors.

RiceVareies although there are more than 4000 varieties of rice that are growing every year.Analysis of Rice Industry Hassan Ali Rice Export Company Hassan Ali Rice Export Company is an affiliate of Hashwani Group Of Companies. and onyx. textiles. Long Grain Rice PK-386 2. Consequently. there has been limited success in the efforts to cultivate Basmati rice outside of South Asia because of the need for many geographically specific conditions. Tons annually. marble. Sub continent has the best soil for cultivation of Basmati rice. Types of Pakistani Non-basmati Rice: 1. agriculture. iron ore. Basmati rice is highly valued for its unique characteristics such as its aroma.e. climate in the foothills of the Himalayas and the sowing practices that farmers developed over the centuries. The Company has been in the Rice business since late 1960's and has remained one of the largest Rice exporter from the country shipping upto Four hundred and Fifty thousand (450. and long-grained quality. flavor. the environmental conditions specific to the soil. Long Grain Rice Irri-9 3. the most famous varieties of Basmati & non-basmati rice in Pakistan are: Types of Pakistani Basmati Rice: 1. real estate. Fortunately the premium quality of rice i. PK-198 or D-98 Basmati. which is one the leading and oldest business houses in Pakistan with interacts in mining commodities. PK-385 Basmati. 3.000) M. It gains many of its special distinctive qualities due to a complex combination of factors including its inherent genetic characteristics. and industrial mining of chrome ore. Basmati rice cultivate only in Pakistan and India. Super Kernel Basmati. 2. Long Grain Rice Irri-6 5|Page .

non-basmati or long grain. cleaned. it is also known as polished rice. In order to categorize the best non-basmati rice. Parboil Rice It is easy to cook and can be made in any variety Basmati. Parboil rice color is like golden because during the paddy boiling.Analysis of Rice Industry 4. the outer bran layers of rice do not allow it to elongates compare to white form of rice does. These kind of rice is having excellent source of fiber. It remains short after cooking. White Rice It is defined as that form of rice whose husk and bran have been removed completely during the milling process. It is an ancient way to boil the paddy to obtain parboil rice. it is essential to notice the thin shape and sharp edges of rice it is not only demanded for its size but also for its taste. Globally it is popular for its fine quality and reasonable price. niacin. rice absorbs the husk color. vitamin B6. magnesium and thiamin. Because the white rice undergoes this process. sorted but not gone through the polisher. Brown Rice All of the above given varieties can be supplied in there brown form means the rice has been husked. graded. 6|Page . This kind of rice is hard to cook but has more vitamins than the white rice because of having 8% bran layers on the top.

The rice is cultivated in the many countries of the world. any supply of demand changes will immediate change the price of the commodity. include rice itself. therefore. because suppliers need to be quickly and accurately compensated for demand of the product. Top Two Producers Consume The Most "China and India are the top two largest producers of rice in the world. This is a strength for the commodity.Analysis of Rice Industry SWOT ANALYSIS: Strength : Most Important Crop Grown Since rice is a staple of diets for large populations of people. High demand will increase the price of the commodity over time. Weakness Unproductive Technology In the Pakistan there is less productive per acer of rice.So there is large number of suppler in the global market those produce in large quality and sell it the lesser price as compare to the Pakistan.but as there is increasing in the demand the rice pirces are also increasing.The farmer are not educated there force they are still using the old machine and fertilizer for the cultivation as compare to other countries there productive is much more then Pakistan. it creates long-term demand for the products associated with rice. Large supply "Second highest worldwide production after maize ("corn"). Both countries 7|Page . Important crops have few substitutes.

New Diet Studies Being Produced: If rice is more nutritious than previously expected. demand for rice will increase as people substitute to rice from other foods. inertia means the total will go on rising until 2050. the demand for rice will also increase. they are sold at higher prices. Asian Cuisine Influence Asian restaurant and food are gaining popularity in other parts of the world.7 billion and 750m people are born each year. Though the rate of increase is declining. As Asian food becomes more popular. the world's population is 6."These both countries produce the much more rice then the Pakistan and as these are bigger countries then Pakistan. That wills double its population by 80m to 160m. Opportunities World's Population Increasing "At the moment. for example. rising to 24m a year by 2040. which provides a net benefit in profits. Threats: 8|Page . Asian recipes rely heavily on rice as their stable ingredient. The demand of the rice is more. In the world the demand of rice is increasing day by day and these countries are largest producers of rice in the world as well largest consumer of the rice in the world. 18m children are born every year." Orangic Farming Organic farming is rising in popularity among consumers who are willing to pay a little extra money for these types of crops. Although its more costly to grow organic crops.Analysis of Rice Industry Consume the majority of the rice produced domestically leaving little to be traded internationally. when Ethiopia.

although ensuring floods are also estimated to have damaged nearly 400. Diseases spread quickly in dense production conditions. This will allow for prices to increase gaining profitability. the growth of diseases is harmful. Punjab and Baluchistan. the report estimates. as farmers switched to cultivation of rice from other crops. the anticipated growth is expected to rely mostly on an expanded area. Diseases have a lasting effect on production of many types of food and plants. Farming Cost Increased The cost of harvesting crops has been rising over time. If supplies lessen and the demand stays the same price will increase. 9|Page . as rice production is expected to expand to 9.4 million tons paddy or 6. and the production outlook for the country remains positive. therefore. slowed the progress of planting activities in Sindh. Spreading out production is less efficient. mostly in Sindh and Balochistan. According to the monitor. followed by precipitation shortfalls for much of July.3 million tons milled rice. CURRENT SITUATION OF RICE INDUSTRY November marks the end of crop harvesting activities in Pakistan. This will cause the density of production to decrease and the demand for other growth regions to increase. However.000 tones of paddy. Plant Disease: Plants are strain to diseases. An upturn of monsoon rains in August provided much relief. due to a slow melting of glaciers. observes the FAO rice monitor. which slow down production rates. limited water availability for irrigation.Analysis of Rice Industry Global Warming Threat: Global warming holds a threat to crop production making agriculture unsuitable in some parts of the planet.

2012 production in Asia would top the 2011 record outcome by 5. Much of the revision reflects an improved outlook for India. FAO has upgraded its July forecast of paddy production in Asia by 3. marginally above the estimate for 2012. 2 percent more than in 2011 and an all-time record. Referring to the only available variety in extra-long grain super basmati. At 660.1 million tons to 660. The industry in Pakistan has also attributed loss of competitiveness to tighter availabilities of fragrant rice supplies. Much of the retrenchment reflects a poor performance in the Basmati rice segment. The downfall in production is because of lack of research and innovation. which was introduced in 10 | P a g e . which is now expected to deliver 3.5 million tonnes (milled basis). where a revival of the rains on the latter part of the monsoon season boosted production prospects. particularly in Near Eastern markets. CONTRIBUTION OF RICE IN PAK ECONOMY Pakistan has tremendous capacity to expand rice production but if proper measures are take the total output can be increased drastically and the assets contribution in economy will reach the $ 4 billion mark. Increasing rice production in Asia means that the region that consumes the most rice will not need to import so much of it.0 million tones.3 million tones in 2013.3 million tons (milled).6 million tones. the export outlook has deteriorated further in Pakistan. However in 2012. FAO forecasts that global rice trade in 2013 will reach 37.0 million tones. milled basis). while we export around one million tons. Due to negligence the production capacity hasn‟t increased in last few years. which currently stands at about $ 1 billion. milled basis).6 million tons. where the country has faced intense competition from India. The Farmer interest in cultivation is also low as prices have remained stagnant since 2008 and a downward trend is expected in 2012-13.6 million tons (440.Analysis of Rice Industry The Rice Monitor forecast that rice shipments from the country may increase and a good crop and competitive pricing may enable exports by Pakistan to recover by 10 per cent to 3.000 tones less than the previously reported and 2 percent below 2011 consignments.6 million tons (440. Rice has the potential to become a high value asset for Pakistan‟s economy but nothing has been done to increase production. brought about by producers‟ shift towards cultivation of hybrid rice. 300.6 million tones. in fact if the trend continues the output may eventually start falling. which was recently raised by more than 3 million tons to 37. Production ranges between two to 2.

9 million MT in 2007-08 showing a decrease 79. Recommendation Rice crop is of great economic importance for Pakistan. he said. The Average Unit Price per Metric ton of basmati rice increased from US$ 939 to US$ 1098.7 million MT in financial year 2008-09 from 2.974 million MT in financial year2008-09 from 1. and is second to cotton as foreign exchange earner In 1997-98.63 in 2008-09 from US$ 653. “India has been able to produce Basmati in areas that are categorized as “non-Basmati” areas.The Average Unit Price per Metric ton also showed an increase from US$ 459 to US$ 520.” ANALYSIS OF INDUSTRY. to western countries. Pakistan exported rice worth over US$550 million and there is a great potential of increasing foreign exchange earnings badly needed for the country Necessarily.138 million MT in 2007-08 showing a decrease of 163. The Average Unit Price per Metric ton increased to US$ 726. all-out efforts 11 | P a g e .67 million MT in 2007-08to 1.” Pakistan is one of the largest producers of rice in the world. The export value of rice (other varieties) witnessed an increase to US$ 912 million in 2008-09 from US$ 767 million in 2007-08. the export value increased to US$ 1983 million in financial year 2008-09 from US$ 1836 million in 2007-08.819 metric tons.Analysis of Rice Industry 1996. The reason behind India‟s success. The export value of basmati rice increased to US$ 1070 million in year 2008-09 from US$ 1068 million in 2007-08. The Basmati rice of Pakistan is of the finest quality that is produced but the country is not utilizing its full capacity at present.60.755 million MT in 2008-09 showing an increase by 84.since then No new high-yielding. Four per cent of India‟s total Basmati production is carried out in Punjab while the rest is grown in areas that are not naturally conducive for Basmati production. as it is second staple food after wheat.788 metric tons.031 metric tons. The above table shows that the quantity of rice decreased to 2. The country is the third biggest exporter of rice.The quantity of rice (other varieties) increased from 1. extra-long grain variety has been introduced by public sector institutions. On the other hand. The quantity of basmati rice decreased to 0. India in comparison with Pakistan has seen their exports increased considerably.

The REAP has proved its performance by checking the quality of brown rice exported to Europe in 1996-97. The alternate source of irrigation water is tubewells. Our canal supplies depend on rains. Along with the adequate supply of irrigation water the quality of water is no less important. as it is second staple food after wheat. In the last 50 years. Pakistan achieved phenomenal increase in rice production. Thus area increased by 3 times. Therefore rescuing the soils from the ill-effects of salts remain a continuous process and the already salt-ridden areas need special reclamation measures by using good quality irrigation water and soil amendments such as gypsum and sulfuric acid. To improve further the per acre yield and overall rice production. The confidence of rice importers in quality of Pakistani rice is gradually building up and exports are steadily increasing.000 hectares which in 1998 reached or 2. The government help is solicited in making available the gypsum at cheaper price affordable by the growers.Analysis of Rice Industry should be made to increase the export to $700 million and first then to one billion. some suggestions are given below: 1. Reclamation of Saline Alkaline Soils: Pakistan is located in semi-arid region where the evaporation of subsoil water brings up the salts to the soil surface. time and distribution The optimum age for sowing nurseries is 30-40 days. It is not difficult to achieve these targets provided we increase per acre yield and improve the quality of exportable rice. Although.000 to 4. In 1947. the area under rice in Pakistan was around 8. The rice production during this period increased from 737. Shortage of Irrigation Water: Satisfactory yields cannot be obtained without assured water supply throughout the rice season. 2. but as the nursery gets older the tillering capacity of plant is badly affected and the result is a serious decline in per acre yields. all-out efforts should be made to increase the export to $700 million and first then to one billion. The farmers sow rice nurseries in time but for land preparation they have to wait for man soon rains which are erratic with regard to amount. Pakistan exported rice worth over US$550 million and there is a great potential of increasing foreign exchange earnings badly needed for the country Necessarily. The Soil Fertility Wing of 12 | P a g e .4 million hectares.6 million tone. 56. the Government has made some structural and administrative changes in monitoring the purity of exportable rice. To improve the quality and sale at high price per unit. improved agronomic practices supported with fertilizers and plant protection measures. Rice crop is of great economic importance for Pakistan. These changes involve analysis of rice of different varieties by the Rice Exporters Association of Pakistan (REACP) and fixing the minimum export price. increased area contributed to increased production but significant increase in per acre yield was brought about by the development of high yielding varieties. It is not difficult to achieve these targets provided we increase per acre yield and improve the quality of exportable rice. and is second to cotton as foreign exchange earner In 1997-98. but the production increased by 6 times.

The Agri. will definitely expedite the installation of modern mills. a variety IRRI-9 (NIAB-6) is cultivated. These results prove the at about 2/3 tube wells are continuously adding salts to soils. which in turn gives high milling recovery and good quality rice for exports. Plant Population: Low plant population is a chronic problem. On an average.0 mm). the dominant variety is basmati-385. the field-water temperature also goes higher. a 30 per cent increase in per acre yield has been obtained with machine-planted crop in comparison with the manual transplanted crop. In these circumstances it is virtually impossible to expect from laborers to comfortably accomplish the transplanting operation and achieve the recommended plant population Lot of work has already been done in successful demonstration of Japanese rice translators. More modern mills should be installed to produce high quality rice for export. Department recommenced 80. The harvested paddy is broken-free and is of high quality. but the actual population hardly reaches or 50. Efforts should be made to modernize these sellers. In the long grain group. We should therefore. 13 | P a g e . In this situation the laborers are sandwiched between the high temperature on their head and hot water under their feet. The rice of Super Basmati fetches higher price in the local and export markets and is competing with the extra-long grain rice exported by other countries.000 plants per acre. The report showed that the water of 1/3 of the tube wells is quite unfit for irrigation. A saving of 8-10 per cent paddy generally lost with manual harvesting/threshing is also a big advantage both for the growers and the country. continue working on developing better varieties in both the groups. In the local and foreign countries there is a demand of both the groups of rice. 4.000. Milling: The export quality of rice cannot be obtained with the old Sheller types. The machines performed equally well in harvesting/threshing of wheat crop in our rice-wheat cropping pattern. This low plant population is due to harsh weather. On account of high temperature. 1/3 have partially fit water (can be used by mixing with canal water) and only the remaining 1/3 have water fit for irrigation. Grain length 7. and in the extra-long grain group is Super Basmati.5mm) and the extra long grain basmati varieties (Av. The Government help by way of abolishing the custom duties etc. Grain length 6. Once can imagine the catastrophic effect on field productivity where such faulty water are used on the already salt affected soils. The long grain rice sells at price lower than the extra long grain rice and suit the pockets of a large number of consumers. Japanese combine harvester have proved their superiority in harvesting rice crop in muddy fields. 5. We should redouble our efforts to develop in this group a chalky-free variety which will fetch better price in the international markets. Development of New Rice Varieties: We are growing long grain basmati varieties (Av.Analysis of Rice Industry the Agriculture Department Punjab made a survey of the tube wells and analyzed the quality of water. 3.000-55. such dual purpose machines can play a significant role in rice economy. This is one of the main reasons that now our yields are almost stationery. Similarly. In the medium grain group. At the time of transplanting the ambient temperature is over 40[degrees]C.

“The rice industry has a huge potential for branded products to penetrate and grow. These brands. Conclusion Rice production in Pakistan exceeds 6 million tons annually. This erodes margins and hurts customer loyalty towards brands that are already present in the market. which have cemented their presence in the domestic market over the years. but so far we have not been able to fully tap this potential. In this regard. In this context. to the extent that they enjoy distinct recognition and market share in the domestic market. Only a few companies have brought branded rice to the domestic market in a sustained manner. which knocks out demand for branded rice even before it is put on the shelves. Dr Tariq Ghori. as the branded tea and oil sector has.” he says. leading to irregular supply. rice marketers‟ distribution network is still at an immature state. and stands at number two after wheat in consumption. more efforts are made. in mixing varieties to lower the net price of the food than in transforming the value chain to ensure good quality at a lower price. Given unhealthy market practices. A majority of consumers usually buy unbranded rice. companies compete on prices rather than building a name based on the quality of their product. we have „Guard‟ basmati. Sadly. 14 | P a g e . This hurts the market for this variety of rice. and it is cultivated in Punjab. a few things come to light. The strain is known as „basmati‟ rice. None of the companies have actually built brands. as they obtain far better margins from abroad. A majority of rice millers and producers are export-oriented. traditional and outdated post-harvest practices have resulted in substantial losses in the output and quality of basmati – affecting the value of produce and farmers‟ profit margins. Furthermore. unbranded rice is sold at much cheaper rates in the local market. and the „Mughal‟ basmati brand from Garibsons. It remains to be seen if the situation will be remedied by an enterprising entrepreneur. by Guard Rice. not been growing at a healthy pace. however. who is the marketing director at Matco. out of which around 40% is consumed domestically while the rest is exported. Matco Rice Processing sells basmati under the brand of „Falak‟. have.Analysis of Rice Industry 1. It would be productive to ask why the branded rice industry has not been able to create a space for itself. Meanwhile. It is certainly a bitter fact to consider that branded rice holds a mere 2. therefore. Pakistan produces one of the best varieties of the grain in the world.1% share in total rice consumption in the country. accepts these shortcomings. Rice is a staple food for the Pakistani people. and for which consumers would be willing to pay a premium.

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