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Informist, Monday, Mar. 3, 2025

 

By Sandeep Sinha

 

MUMBAI – India's basmati rice exports in the quarter ending March are likely to fall sharply from a year ago because of weak demand and expectation of a further fall in prices, according to Indian Rice Exporters Federation National President Prem Garg. "The situation is further worsened by the sharp rise in container rates to West Asia and Europe as exporters have to bear the additional costs", Garg told Informist.

 

Increased competition from Pakistan, subdued demand during the Ramadan month and record domestic production are putting downward pressure on prices. The lifting of the ban on non-basmati rice exports by the government in late September is also impacting basmati demand as countries start procuring cheaper rice varieties, he said.

 

Garg sees basmati rice exports in Jan-Mar falling 1.0 million tonnes from 1.7 million tonnes a year ago. Exports of premium rice variety is seen at 400,000 tonnes each in January and February, and 200,000 tonnes in March, he said.

 

The industry estimates India's basmati rice production to be 10-15% higher than last year because of the above-normal southwest monsoon, rise in sowing area and better yields.  

 

The price of India Pusa basmati fell to $1,000 per tonne in January from the high of $1,400 per tonne during Jan-Sept last year, according to the United Nation's Food and Agriculture Organization monthly report. The increased competition among traders will keep aromatic rice prices subdued in the next couple of months, Garg said.

 

The ongoing shipping crisis in the Red Sea, the diversion of the shipping lane through the Cape of Good Hope, and congestion at Chinese ports before the Lunar New Year pushed the container freight rate. Garg said the container rates to Europe have doubled to $2,000 per container from $1,000 earlier. Similarly, container rates to West Asia have also increased.

 

West Asia, which accounts for over 75% of Indian basmati rice exports, purchased an excess quantity in the December quarter. Buyers are currently assessing the market situation and will accordingly make their future purchases, Garg said.

 

The value of basmati rice exports from India rose 14.3% to a record high of $6.19 billion in 2024. In quantity terms, basmati exports in 2024 at 5.94 million tonnes, surpassed the previous high of 4.99 million tonnes in 2020.

 

India's share in global basmati rice exports was 87.2% in 2024, with Pakistan accounting for the rest. End

 

US$1 = INR 87.37

 

Edited by Saji George Titus

 

 

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