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Informist, Friday, Nov. 8, 2024

MUMBAI – India's pusa basmati rice prices have fallen 10% on month and 32.3% on year to $1,050 per tonne in October following the government removing export curbs in September, the United Nations Food and Agriculture Organization said in its monthly report.

On Sept. 13, the Indian government scrapped the minimum export price of $950 per tonne on basmati rice shipments. In August 2023, the government had imposed a minimum export price of $1,200 per tonne to control illegal exports of non-basmati rice exports, which were banned then. Later in October 2023, the government reduced it to $950 per tonne. 

The fall in Indian pusa basmati prices has weighed on the overall aromatic index, pulling the index down to 101.6 points in October from 103.0 a month ago, the report showed. The increase in basmati prices in Pakistan and "Hom Mali" variety in Thailand was offset by the fall in Indian basmati prices, the report said.  

Meanwhile, the global FAO All Rice Price Index averaged 125.7 points in October, down 5.6% from September and 9.5% from a year ago, it said, adding, "Indica prices were responsible for the FARPI’s (FAO All Rice Price Index) decline". In October, the Indica index fell 7% on month to 134.6 points, which is a 16-month-low, the report said. 

On the other hand, the Glutinous index strengthened by 5.6% in October to 117.4 points from the previous month and the Japonica index rose nearly 1% to 98.4 points, the report showed. 

EXPORT COMPETITION

After allowing exports of non-basmati white rice with a minimum export price of $490 per tonne and reducing the export duty on parboiled rice from 20% to 10% in September, the Indian government removed these export curbs in October. The government had also allowed duty-free exports of paddy and brown rice in October. India first banned exports of broken non-basmati rice in September 2022 and non-basmati white rice in July 2023 to control domestic prices.

Following the Indian government's decree, quotations for Thailand, Pakistan, and Vietnam's rice prices fell in October, according to the report. 

The price of Pakistani 5% rice fell to $477.3 per tonne in October from $540.0 per tonne in September, and the price of Thai A1 Super rice fell to $445.3 per tonne from $477.0 per tonne during the same period.

Similarly, the price of Thailand's 25% broken rice fell to $501.0 per tonne in October from $556.0 per tonne in September. The price of the same variety of rice from Vietnam fell to $495.0 per tonne in October from $511.5 per tonne in September, according to the report. 

"October began on a soft note in Asian markets of Indica rice, as prospects of increased export competition following India’s September relaxation of its export restrictions weighed on sentiment," according to the report. 

Meanwhile, the price of India's 25% broken rice was at $477.3 per tonne in October and that of India's 5% broken rice was at $481.0 per tonne. Before the ban of non-basmati exports in 2023, prices of India 25% broken rice and India 5% broken rice were $422.1 per tonne and $440.0 per tonne, respectively, according to the report.  End

US$1 = INR 84.37 

Reported by J. Navya Sruthi

Edited by Vandana Hingorani

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