THE wholesale commodity market (Dandia Bazaar) maintained a lacklustre performance last week. Prices of commodities either remained intact or registered slight decline.

However, fall in basmati export remained a cause of concern for the exporters. The prices, which had increased during the last few months, remained unchanged for the last several weeks. Basmati exports of 622,449 tons had fetched $574 million in July-March 2011-2012 as against $698.5 million for export of 859,062 tons in the same period last fiscal year. Export of other varieties stood at 1,565,446 tons ($914 million) as compared to 1,906,220 tons ($898 million) in the same period last fiscal year.

Vice-Chairman, Rice Exporters Association of Pakistan (REAP), Safdar Mehkri, linked the decline in Pakistani basmati exports to cheaper Indian rice, crop surplus and devaluation of Indian rupee.

A border trade of basmati rice was going on as some people were lifting the commodity from wholesale market for onward shipment to Iran and Afghanistan. Consumers witnessed a price jump in basmati rice few months back due to sudden demand. However, the border trade recorded by officials was estimated at 20-30 per cent only while a sizable quantity made its way to neighbouring countries through informal routes.

Other varieties of Pakistani rice, he said, did not feel the pinch of cheap Indian rice prices as it fetched higher prices in world markets despite drop in quantity. Besides, India had also resumed its non-basmati export since October 2011.

Mr Mehkri said that China, which used to buy non-basmati rice from Thailand and Vietnam, had started imports from Pakistan in larger quantities. Prices in Thailand appreciated due to increase in support price making it uncompetitive in world market. Vietnam had also raised rice prices.

Pakistan has a Free Trade Agreement and Plant Quarantine Protocol with China which Indian does not. China was buying 400,000-600,000 tons of rice from Vietnam and Thailand but was now importing it from Pakistan.

Pakistan produces 6.2 million tons of basmati and other varieties per annum out of which two million tons are consumed locally leaving an exportable surplus of 4.2 million tons.

Wheat: Wheat prices moved up by Rs50 per 100kg bag but its impact was not seen on flour prices.

The Sindh Food Department had so far procured over one million tons of wheat against its target of 1.3 million tons from growers at the official rate through 390 procurement centres established in Sindh. Around 4.2 million tons of wheat was expected this year.

On the prospect of wheat export to Iran, Abdul Kalim Baakza, Senior Vice-Chairman Wheat Traders Association of Pakistan, said the association had studied reports regarding export of the commodity to Iran at a rate of $275 per ton FOB Karachi.

The export and price were yet to be approved by the federal government.

He said in case wheat was exported at $275 per ton, the government would have to give a subsidy to exporters as the support price at which the government would purchase wheat would be higher than $275 FOB price.

Sugar and pulses did not show any fluctuation in prices owing to lack of extra demand. In ghee and cooking, a ghee merchant said, the market had witnessed downward trend owing to fall in edible oil prices in world markets.

International palm olien and RBD palm oil prices on Monday were quoted at $1,062 and $1,047.50 per ton (C&F Karachi) as compared to $1,135 and $1,120 per ton on May 11.

On Wednesday, he said, the prices of palm olien and RBB palm oil rose to $1,165 and $1,150 per ton but plunged sharply owing to worries over Greece’s potential exist from the euro zone and the upcoming elections in the European Union.

Global fall in oil price also affected local prices, and palm olien and RBD palm oil plunged to Rs5,050 and Rs4,950 per maund from Rs5,275 and Rs5,180 per maund respectively.

Price of 16 kg ghee and 16 litre cooking oil tins, which were selling between Rs2,600 and Rs2,700, fell to Rs2,490 and Rs2,650 respectively. —Aamir Shafaat Khan