Rice exporters seek abolition of MEP

KARACHI - Keeping in view falling prices of rice below the minimum export price (MEP), the rice exporters have demanded the government to abolish the condition of MEP to ensure smooth exports of rice. The rice exporters while talking to The Nation urged the Ministry of Commerce to remove the minimum export price fixed on basmati and non basmati varieties of rice as the prices have already fallen much below the MEP which was disabling the exports of the commodity. "There was no need to maintain the condition of MEP any more as the prices of rice have declined much below the MEP as small and medium exporters were not securing orders due to the declining international prices, an exporter said. He said the current MEP does not allow them to export Irri 6 below $750 dollars, Irri 9 below $1000 dollars, basmati at $1300 dollars and Super Basmati below $ 1500 dollars per metric ton free on board (FOB). According to the current prices, the exporters can easily export irri 6 at $700 per ton, irri 9 $900 per ton, basmati $1200 and supper basmati at $1400 per ton. An exporter said some influential exporters were securing export orders at lower than the minimum export price and returning the difference through other channels, but he did not disclose the other channels and added, the small and medium level exporters were not indulging in this practice nor do they enjoy such overseas connections. The exporters stressed that the ministry of commerce must pay attention to the difficulties which they were facing and remove the condition of minimum export price immediately which will enable rice exporters both big and small to export the rice. An analyst was of the view that many exporters benefited by the imposition of MEP as it enabled them to back-out of their commitments on the plea that they were bound by the MEP and could not ship below the MEP. But many small exporters suffered as for a long period of time they remained without business due to the MEP which was not acceptable to the buyers. When contacted  by The Nation president Union of Small and Medium Enterprises Zulfikar Thaver said they have already sent a letter to ministry of commerce for removal of the MEP which was hindering exports. He said it was unwise to continue minimum export price when it encouraging rise to malpractices in rice export.

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