ISLAMABAD: The export of raw food products recorded an upsurge of almost 111.63 per cent in December compelling domestic consumers to pay higher prices.
These unchecked exports pushed the food inflation to a staggering 28.8pc in December 2023 as prices skyrocketed affecting accessibility to essential commodities, particularly wheat flour, rice, sugar, meat and vegetables.
Since October 2023, the country’s raw food exports have increased dramatically, although manufacturing sector exports have remained flat for several months.
Food exports grew 49.84 per cent in the first half of fiscal year 2023-24 to $3.48 billion from $2.32bn in the corresponding months of last year, according to data released by the Pakistan Bureau of Statistics (PBS).
Consumers are paying unprecedented prices for meat, chicken and rice
The surge in food exports can be attributed to the unprecedented rupee depreciation. In addition, persistent disruptions in the supply chain and higher prices in the international market have led to soaring demand for food products.
The PBS data showed the country’s rice exports rose 76.53pc in July-December FY24 led by basmati rice, which had been falling since last year.
The export of basmati rice experienced a notable surge of 30.03pc, reaching $367.39 million in July-December FY24 from $282.53m in the corresponding period last year.
India’s recent decision to impose a ban on rice exports has emerged as a key driver behind the surge in basmati rice exports.
According to PBS data, the export of non-basmati rice rose 96.88pc to $1.64 billion in July-December 2023-24 from $645.38m in the same period last year.
Due to a sustained surge in export figures over the past two years, the average price of basmati rice has surged to Rs380 per kg from Rs150, restricting buying from domestic consumers.
Pakistan exported $239.71m worth of meat in 6MFY24 from $191.91m over the last year, showing a growth of 24.90pc. The reason for the increase in meat exports is the introduction of new markets like Jordan, Egypt, and Uzbekistan.
At the same time, several new enterprises are registering to export meat to the United Arab Emirates, Saudi Arabia and other Gulf nations. Malaysia also cleared another three slaughterhouses for export/processing. Furthermore, one meat exporting company was granted market access for heat-treated meat shipments to China.
The prices of meat in the domestic market have experienced an unparalleled surge in recent years. In two years, the average price of buffalo meat has jumped from Rs700 per kg to Rs1,250 per kg. This increase has caught the attention of market observers and stakeholders alike. The price of chicken has also experienced an unprecedented surge, reaching its highest level in the last two years.
The export of fruits saw an increase of 9.31pc in the first half of FY24 to $171.28m against $156.69m over the last year. The export of all other food products saw an increase of 22.62pc to $616.81m in 6MFY24 from $503.03m over the corresponding months of last year.
Pakistan exported fish and fish products worth $199.02m in the first half of FY24, showing a decline of 11.63pc from a year ago of $225.21m.
Published in Dawn, January 21st, 2024
