ISLAMABAD – Pakistan, Asia’s third-largest wheat producer, is expected to restart exports in January after the government lifted a three-year ban earlier this month, traders said on Wednesday.
Traders in the country’s commercial hub of Karachi said queries have been made by Bangladesh, Sri Lanka, Indonesia, Malaysia and some Middle Eastern countries, and confirmed orders are expected by the end of the month. “There is brisk activity in the market after the formal notification by the government to lift the ban, and people have started stocking up on wheat for export,” said Korangi Association of Trade and Industry Chairman Johar Ali Qandhari.
“We expect shipments to begin in January; there is a lot of interest in Pakistani wheat. Queries are coming in from around the world, including Bangladesh, Egypt, Jordan, United Arab Emirates (UAE) and Singapore,” he stressed. Earlier this month, the government lifted the ban on exports put in place in 2007, but did not reveal any limit on exports.
The government banned wheat exports in 2007 after public outcry over domestic shortages and high prices. Two finance ministry officials then stated that one million tonnes would be cleared for export soon. Traders expect exports to exceed that level, citing a formal notification issued last week, which they claimed did not mention any cap.
“There is no limit mentioned in the notification so we are hoping that permitted export will exceed one million tonnes,” said Javed Thara, a Karachi-based trader. Pakistan in August deferred earlier plans to export two million tonnes of surplus wheat after summer floods washed away at least 725,000 tonnes of the grain and raised concern about the next harvest.
Traders say Pakistani wheat will cost about $335 a tonne FOB (freight on board) and could allow Pakistan to seize a stronger global market share. Russian and European exports will be relatively more expensive because of winter transportation costs. Pakistan had a bumper crop of 23.86 million tonnes in 2009/10, adding to a carryover of 4.2 million tonnes from the previous year.
