Pre Feasibility Report on Par Boiling Rice Plant in Pakistan

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Institute of Business Management

Project Appraisal
Pre-feasibility on Parboiled Rice Plant
Submitted To: Submitted By:
Mam Shazia Farooq Athar Ali Khichi Haresh Daswani Umair Naseer Noor Effendi Kiran Subhash Muhammad Ali

Dated:

April 15, 2010

Letter of Transmittal ........................... 3 Introduction......................................4 About Rice ......................................5 Forms of Rice ...................................6

Table
Rationale behind Parboiled Rice ................ 7 Market and Demand analysis ................... 8

Of
Pakistan Agriculture Economy & Policy ........ 20 SWOT Analysis .............................. 22

Contents
Technical Analysis............................. 24 Financial Analysis............................. 31 Conclusion ..................................... 38 Bibliography ................................... 39

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Pre-feasibility on Parboiled Rice Plant

Letter of Transmittal
April 15, 2010

Ms. Shazia Farooq Professor Institute of Business Management Korangi Creek Karachi – 75100

Dear Ms. Shazia Farooq: Here is the feasibility report for a green field project in the Rice milling industry in Pakistan. As you will see, we have published the assigned research in the report. We are confident that these results will illuminate the potential for establishing a new firm in the aforementioned industry. We greatly appreciate being appointed on this term report, and on a topic which is challenging and very educational.

Sincerely,

Umair Naseer Haresh Daswani Kiran Subhash Noor Effendi Athar Ali Khichi Mohammad Ali Rohail Pirzada

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Pre-feasibility on Parboiled Rice Plant

Introduction
Pakistan being an agro-based economy has natural abundance of all agricultural products including food items. Rice is the third largest crop after wheat and cotton. It is grown over 10% of the total cropped area. Rice is highly valued cash crop and is also major export item. It accounts for 6.7% in value added in agriculture and 1.6% in GDP. Pakistan grows enough high quality rice to meet both domestic demand and allow for exports of around one million ton per annum. Different varieties of rice are grown in Pakistan for example Super Basmati, Basmati PK-385, Irri6, Irri-9 and KS-282 etc. Pakistan is primarily known for its Aromatic rice (Super Basmati/Basmati PK-385). Two varieties of rice dominate the market: Basmati, which is mainly grown in Punjab and Irri, which is mainly grown in Punjab and Sindh. Basmati accounts for 2% of exports and is of a higher quality than Irri. In 1987-88, the government allowed rice export also by the private sector. Before this, the Rice Export Corporation of Pakistan (RECP) was exclusively handling rice export of Pakistan. Before the private sector was allowed rice export, RECP was the sole rice procurement agency in the country while Passco procured very small quantities and the rest was obtained by the private sector for local consumption. The private sector rice trade comprised mainly of rice dealers, sellers and growers. Their main concerns were the varieties approved for growth in the Punjab and their respective support prices prior to harvest in September through December. After rice exports were allowed to the private sector, a new body of people emerged in the shape of rice exporters. The rice exporters had no platform from which to interact with the government. They had a new and different set of problems that were related with marketing of rice globally, correcting systematic deficiencies that emanated from a monopoly procurement system with politically inspired support prices followed by politically priced overseas sales of bulk quantities at low prices and mainly in bulk sized packing.

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Pre-feasibility on Parboiled Rice Plant

About Rice
DEFINITIONS: A) RICE: means milled rice which...
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