Overview Of Agriculture Sector & Rice Sector

Agriculture sector is an exclusive sector in which our modes of life and our business enterprise
are combine. Agriculture sector is the most important part of the economy of Pakistan.
Agriculture sector is contributing almost 23.4% in the economy of Pakistan.

Agriculture sector is provision of food security for our people relatively the maximization of
production. It gives us livelihood and makes connectivity within the country. Approximately
70% of total population of Pakistan lives in rural areas. Almost 45% of work force is engaged
with agriculture sector.

Pakistan major crops are wheat, rice, maize, sugarcane and cotton. Contribution of major crops
in agriculture sector is about to be 25.6% and contribution of major crops in GDP is almost
5.4% according to the economic survey of Pakistan.

Rice is one of the most important cereals and is a major source of food for large number of the
people worldwide. It is grown on about one-tenth of the earth’s arable land. Most of the rice in
the world is cultivated and consumed in Asia.

Rice plays an important role in the economy of Pakistan as an important food source as well as
the major export commodity in the agriculture sector. Rice is cultivated on a area of more than
two million hectares. A huge quantity of rice is exported which brings a lot of foreign exchange
for the country.

Pakistan has two main cropping seasons per year, kharif (rainy) and rabi (postrainy). Rice is
grown in the kharif season (June-October) only whereas non rice crops such as wheat, gram,
and lentils are grown in the rabi season (December-April). Rice is normally sown in June and
July and harvested in October and November.

Food crops play a dominant role in the farming system, in which rice and wheat are the major
crops. Rice occupies 52% of the gross cropped area. Wheat is planted to 33% of the area,
followed by mustard, green peas, sunflower, and other crops that comprise 15% of the area.

In the kharif season, farmers grow only rice, whereas, in the rabi season, a majority of the farms
grow wheat along with other crops. Farmers usually rotate rice with wheat, that is, they grow
rice (in kharif season) and wheat (in rabi season) on the same land. Land use in the sampled
area has an intensity of almost 2.0, which means that land is being used or grown to crops twice
in a cropping year.

1|Economics Analysis for Managers

Paddy Rice Production Worldwide in 2017

S. No Country Production Volume Million Metric Tons

1 China 210.1

2 India 165.3

3 Indonesia 74.2

4 Bangladesh 53.1

5 Vietnam 44

6 Thailand 33.3

7 Myanmar 28.3

8 Philippines 18.6

9 Brazil 11.9

10 Japan 10.7

11 Pakistan 10.3

12 Cambodia 9.7

13 United States 9.1

14 Egypt 6.2

15 South Korea 5.5

“According to survey, in year 2017 Pakistan has produced 10.3 million metric tonnes of paddy
rice and ranked 11th worldwide”.

2|Economics Analysis for Managers

Rice Production of Pakistan

Input Supply for Rice

The most important inputs needed to produce good quality of rice include:

o Seeds
o Fertilizers & Pesticides
o Farm Machinery
o Irrigation

Seeds

Seeds are marketed to the farmers through,

o Sindh and Punjab Seed Cooperation

o Rice Research Institute
o Kala Shah Kaku and Private Seed Companies,

The aforementioned sources supply fifty percent of seed, the rest is procured through their own
farms.

Fertilizers & Pesticides

Farmer access their fertilizer needs through the private dealer operating for companies like
Fauji Fertilizers (FFC), Engro Fertilizers Limited (EFL), Daud Hercules, Ali Akber Group
(AAG), Jaffer Brothers Limited etc. They maintain distribution network operating in the rice
belt.

Farm Machinery
In the rice belt land preparation has been fully replaced by farm machinery now using tractors
and harvesters. A service industry has emerged that provides farm machinery on rents.

Irrigation

Irrigation

As water scarcity is a binding constraints on rice production, it would be prudent policy to

promote enhancing water productivity / values, this can be enhanced by developing short-
duration varieties that consume less water and to use recommended on farm water management
process.

3|Economics Analysis for Managers

Rice Production Zone

In Pakistan, rice is grown under diverse climatic and climatic conditions. Rice Growing areas
of Pakistan are broadly classified into following four zones;

Northern high mountainous areas of KPK (Swat and Khagan) with sub-humid
Zone I
climate, average rainfall of 750-1000 mm

Lies between the Ravi and Chenab rivers in the central Punjab. Sub-humid,
sub-tropical climate with average rainfall of 400-700mm. This is the famous
Zone II premium zone and Basmati rice is exclusively produced in this zone along the
Kalar tract consisting of Sailkot, Sheikhupura, Narowal, Gujranwala,
Hafizabad and Lahore Districts

West bank of Indus river in upper Sindh and Balochistan. Larkana, Jacobabad
(Sindh), Nasirabad and Jaffarabad (Balochistan). High temperature and sub-
Zone III
tropical climate with average rainfall of 100 mm make it best suited for medium
long rice.

Indus delta basin in Lower Sindh (Badin and Thatta Districts). Its climate is
Zone IV
arid tropical and is suited for coarse varieties.

Contribution of Provinces In Rice Production

S. No Province Contribution

1 Punjab 54.87%

2 Sindh 35.96%

3 Balochistan 7.29%

4 KPK 1.89%

Total 100%

4|Economics Analysis for Managers

Rice Varieties:

Three types of rice varieties are cultivated in Pakistan i.e. Basmati types (aromatic), medium
long grain (IRRI type) and bold grain (cold tolerant varieties). Basmati rice is famous
throughout the world for its excellent cooking and eating qualities combined with very pleasant
aroma. The medium long grain rice varieties are mostly cultivated in Sindh and give higher
yield than Basmati varieties. Basmati primarily grown in Punjab and accounts for 73% of the
rice area in the whole province

Varieties

Production Zones
Basmati
Non Basmati Cold Tolerant
(Aromatic)

JP-5
Basmati 385
Zone I Pakhal SWAT I
Kashmir Nafees
SWAT II

Basmati 385

Basmati 370

Basmati 6129
IR6
Basmati 198
Zone II KS282 -
Basmati 2000
NIAB IR9
Basmati Shaheen

Rachna Basmati

Super Basmati

IR6, DR-82, DR-83,

Zone III - -
DR-92 Sada Hayat

IR6, DR-82, DR-83,

Zone IV Khushboo 95
Shadab, Sarshar

5|Economics Analysis for Managers

Rice Marketing Channel

Agriculture can be divided into two equal important phases, namely production and
marketing. There are various market intermediaries involved in the marketing of paddy rice,
this process can be divided into two parts which are as follows:

Producer to Processor (Millers)

(A)

Village Commission
Producer Dealer Agent
Processor

(B)

Commission
Producer Agent
Processor

Processor to Consumer

(A)

Processor Whole Saler Retailer Consumer

(B)

Processor Retailer Consumer

6|Economics Analysis for Managers

Rice Production in Pakistan

Year Production Unit Measurement Growth

2017 7,200 (1000 MT) 5.11 %

2016 6,850 (1000 MT) 0.74 %

2015 6,800 (1000 MT) -1.45 %

2014 6,900 (1000 MT) 1.50 %

2013 6,798 (1000 MT) 22.80 %

2012 5,536 (1000 MT) -10.13 %

2011 6,160 (1000 MT) 27.72 %

2010 4,823 (1000 MT) -29.93 %

2009 6,883 (1000 MT) -0.99 %

2008 6,952 (1000 MT) 24.97 %

2007 5,563 (1000 MT) 2.30 %

Rice Production
8,000
7,200
6,850 6,800 6,900 6,798 6,883 6,952
7,000
6,160
6,000 5,536 5,563
4,823
5,000
4,000
3,000
2,000
1,000
0
2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007

7|Economics Analysis for Managers

Rice Consumption in Pakistan

Market Year Consumption Unit of Measure Growth Rate

2017 3,635.06 (1000 MT) 5.45 %

2016 3,447.11 (1000 MT) 5.45 %

2015 3,268.87 (1000 MT) 5.45 %

2014 3,099.85 (1000 MT) 5.45 %

2013 2,939.57 (1000 MT) 2.46 %

2012 2,868.98 (1000 MT) 1.93 %

2011 2,814.57 (1000 MT) -2.06 %

2010 2,873.65 (1000 MT) -14.48 %

2009 3,360.33 (1000 MT) 15.68 %

2008 2,904.75 (1000 MT) 9.05 %

2007 2,663.75 (1000 MT) 25.58 %

Rice Consumption
4000 3635.06
3447.11 3360.33
3500 3268.87
3099.85
2939.572868.982814.572873.65 2904.75
3000 2663.75
2500
2000
1500
1000
500
0
2017 2016 2015 2014 2013 2012 2011 2010 2009 2008 2007

8|Economics Analysis for Managers

Rice Export of Pakistan – In terms of Value with World Export of Rice

Pakistan Export
Total Export Value Pakistan Export
Year Value In
(Billions) Value (Billions)
Percentage

2016 $ 13.9 $ 1.7 12.2%

2015 $ 22 $ 1.91 8.7%

2014 $ 24.9 $ 2.24 9%

2013 $ 24.5 $ 2.12 8.6%

2012 $ 23.5 $ 1.94 8.3%

2011 $ 23.6 $ 2.22 9.4%

2010 $ 20.8 $ 2.41 12%

2009 $ 19.2 $ 1.77 9.2%

2008 $ 22.8 $ 2.45 11%

2007 $ 13.9 $ 1.14 8.2%

Rice Export in Billions

3
2.41 2.45
2.5 2.24 2.22
2.12
1.91 1.94
2 1.7 1.77

1.5
1.14
1

0.5

0
2016 2015 2014 2013 2012 2011 2010 2009 2008 2007

9|Economics Analysis for Managers

GPD / Agriculture Contribution of Rice

Year Value Add GDP Contribution

2016-2017 3.00 % 0.60 %

2015-2016 3.10 % 0.60 %

2014-2015 3.20 % 0.70 %

2013-2014 3.10 % 0.70 %

2012-2013 2.70 % 0.60 %

2011-2012 4.90 % 1.00 %

2010-2011 4.40 % 0.90 %

2009-2010 6.40 % 1.40 %

2008-2009 5.90 % 1.30 %

2007-2008 5.50 % 1.10 %

2006-2007 5.70 % 1.20 %

GDP Contribution
1.60%
1.40%
1.40% 1.30%
1.20% 1.10%
1.00%
1.00% 0.90%
0.80% 0.70% 0.70%
0.60% 0.60% 0.60%
0.60%
0.40%
0.20%
0.00%
2016 2015 2014 2013 2012 2011 2010 2009 2008 2007

10 | E c o n o m i c s A n a l y s i s f o r M a n a g e r s
http://www.pbs.gov.pk/sites/default/files//tables/Table%201%20area_production_crops.pdf

https://www.indexmundi.com/agriculture/?country=pk&commodity=milled rice & graph =

production

http://ricepedia.org/pakistan

http://finance.gov.pk/survey_0607.html

https://www.omicsonline.org/open-access/contribution-of-agriculture-sector-in-the-gdp-
growth-rate-of-pakistan-2375-4389-1000184.php?aid=71383

http://www.amis.pk/Agristatistics/Data/HTML%20Final/Rice/Production.html

11 | E c o n o m i c s A n a l y s i s f o r M a n a g e r s