Pakistani basmati rice exporters expect Iran’s purchases in June: sources

Basmati rice exporters in Pakistan are preparing for a possible purchase tender from Iran in early June that could push recently firm prices even higher, market sources told Platts May 30.

The purchase would likely support prices for Pakistani 1121 Basmati varieties, which are at their highest in 20 months.

Platts, part of S&P Global Commodity Insights, assessed Pakistani 1121 Steam Basmati rice at $1,197/mt FOB FCL on May 30, up $113/mt month over month. The price was last higher Sept. 1, 2023, at $1,199/mt FOB FCL.

Iran's Government Trading Corp. "has an intent to purchase Basmati rice," a Karachi-based exporter said, citing discussions in the market. "The quota for this purchase is expected to be released in June, but the details regarding the quantity are still to be confirmed."

Other sources expect Iran to seek to buy around 150,000-200,000 mt of rice in June.

According to trade sources, the GTC does not issue international tenders like the white rice tenders released by Indonesia's state procurement agency Bulog, and it typically provides local tenders for the allocation of quotas to Iranian importers. Iranian importers apply for quota registration, specifying the variety of rice and the quantity they wish to import. Once they receive the import quota, Iranian importers can begin purchasing rice. This process is similar to obtaining import permission, with no restrictions on pricing.

The Middle East is an important market for Pakistani Basmati rice. According to sources, countries in the region, particularly Iran, mainly favor Basmati rice varieties such as 1121 Basmati Steam and Sella.

Moreover, according to the figures released by the Statistical Centre of Iran, in April and May 2025, Iran's Consumer Price Index for households rose to 336.9, marking a 2.7% increase from the previous month and a 38.7% rise compared to the same month last year. This suggests that prices for consumer goods and services have been rising in Iran. This has led to increasing interest in imported rice.

"It appears that purchasing from Pakistan is necessary for Iran, as there are no alternatives for 1121 Basmati rice, with local consumption increasing daily, along with local prices for Iranian rice," another Pakistani exporter said.

"There is also an urgent need for rice delivery within 45 days, which means shipments will need to arrive in Iran before the Islamic month of Muharram, which begins next month on July 7, 2025," the same exporter said. "However, Pakistani exporters sometimes face complications related to shipment, transport, and payment when dealing with Iran. So, we will see what happens next."

Pakistani rice exports have been impacted by India's return to the international rice market in 2024, as buyers are increasingly choosing the more affordable rice from India.

Cross-border flows

Basmati export figures for Pakistan showed negative estimates in the latest monthly forecast for April 2025, with Basmati exports decreasing significantly by 37.93% to 43,895 mt from the previous month, according to data released by the Pakistan Bureau of Statistics.

Pakistani sources said that the primary factor contributing to the decline in Basmati exports in April 2025 was the closure of the Iran border during that period. However, prices surged as cross-border trade resumed as usual in May 2025.

A Pakistani Basmati rice exporter dealing in shipments to Europe quoted, "Local prices for Basmati varieties in Pakistan are already elevated. There is strong local demand for 1121, and a short crop is driving prices higher. If the Iran tender is successful and Pakistan supplies them, prices are likely to rise even further. However, if demand shifts to India, given their more competitive prices, the price gap between India and Pakistan may narrow."

Pakistan is forecast to export 5.7 million mt of rice in marketing year 2024-25 (November-October), down 12.7% year over year, according to the latest S&P Global Commodity Insights data.