LAHORE, Jan 15: The Basmati Growers Association has reiterated its support to government policy of procuring rice through Pakistan Storage and Supplies Corporation (Passco) and the Trading Corporation of Pakistan (TCP) to stabilise paddy prices.
The association in a press statement on Thursday termed the Rice Exporters Association’s (Reap) campaign an attempt to cartelise the rice trade.
Ch Hamid Malhi, president of the association, said that the Passco intervention was delayed and the impact was not maximum however it helped stabilise Basmati paddy prices above Rs1,200 per 40-kg.
The intervention by TCP to purchase 150,000 tons of Basmati rice and 350,000 tons of Irri-6 also checked falling trend in rates, he added.
The farmers produced 6.3 million tons of rice this year with high costs of input, but the agreed price of Rs1,500 per 40-kg of Basmati paddy was denied. The Reap was part of this decision.
The total basmati rice purchase of 200,000 tons and 150,000 tons by Passco and the TCP, respectively, is only equal to the increase in basmati rice production this year and the exporters still have the same quantity of rice to export as last year, he explained. “Public sector intervention is only seven per cent of the total produce. The impact on domestic rice prices are not up to the desired levels,” he pointed out.
In the absence of government intervention, he said, the farmer would have suffered unimaginable loss and the domestic rice trade would have collapsed.
He observed that the recent press campaign had already brought down rice prices by Rs200 per 40-kg. “If exporter-owned rice processing units were running at only 30 per cent capacity, how they could achieve half of the export target in the first six months of the year?” he posed a question. He felt that it was strange that rice exporters were getting credit at low mark-up rates under the Export Finance Scheme (EFS), while farmers, whose hard work leads to this bumper production, had to pay above 15 per cent interest on loans.
“It is the growers’ hard work which increased rice production from 3.2 million tons in 1990 to 6.3 million tons in 2008-09. The country will lose more in productivity with a negative signal, if the government heeds to the demands of stopping public sector intervention in rice purchases,” he asserted.
Mr Malhi said that growers were the rightful owners of the Geographical Indication of Basmati, since they had been growing basmati for centuries and would continue sowing it in future at all costs.
“Those who are playing to the tunes of our only competitor should review their line of action and resist from working against the interests of Basmati and its major stakeholders -- the growers,” he advised.