India’s non-basmati rice exports rose 4 percent to 14.56 million tonnes (mt) during the April-January period of the current budget from 14.01 mt a year ago. This is despite the government levying a 20 percent export duty on white (raw) rice and banning the shipment of fully broken rice. However, with an upward trend in freight costs, the realization by exporters may be affected if the importing countries do not absorb every increase.
The non-basmati rice segment saw a 3 percent increase in value to US$5.17 billion (£41,273 million) versus US$5.01 billion, according to the latest data from the Agricultural and Processed Food Export Development Agency (APEDA). in the same period last year. . For the entire 2021-22 period, non-basmati rice exports were 17.26 tonnes worth US$6.12 billion (£45,652.35 million).
Exporters said when the government introduced the tariff in September last year, freight costs were around $100-$120/ton and are declining. While falling to around $50/ton in February, it started showing an upward trend in the first week.
“Importing countries have not felt the impact of export tariffs as freight costs have fallen over the same period. What is certain is that the world now knows India as a credible destination for non-Basmati rice,” said BV Krishna Rao, President of the Rice Exporters Association (TREA). For now, there are no concerns and exporters are willing to wait for the arrival of the next kharif crop in October to see if a policy change is needed, Rao said.
He said the increase in non-Basmati rice needs to be seen amid crop failures in Pakistan and also volume restrictions in Myanmar. However, he said: “The world needs Indian rice. We will seek a policy change if there is any decline in exports at all.”
Fair review in Sept
Rao said even after the export tariff was introduced, there was no significant improvement in sourcing nor a decline in exports. He said a fair assessment could be made by September of what the kharif rice harvest would be like and a decision could help exporters secure new contracts for October-November deliveries.
“Since there is no fresh harvest from other sources before September, we are fairly secure until then. A policy review at that time will definitely help,” Rao said.
Meanwhile, basmati rice rose 41 percent to $3.82 billion (£30,514 million) in the 10 months to January, and volume rose 18 percent to 3.66 million tonnes. Total exports of rice (both non-Basmati and Basmati) rose 16 percent to US$8.98 billion (£71,787 million).