India's basmati rice exports seen surging after floor price removed

KRBL

24/09/2024 10:30

By Mayank Bhardwaj and Rajendra Jadhav
       NEW DELHI/MUMBAI, Sept 24 (Reuters) - India's decision
to remove the floor price for basmati rice exports is expected
to spur a flurry of orders from the Middle East, Europe, and the
Americas, leading exporters said, helping New Delhi to increase
its share of the global market.
    The world's biggest rice exporter earlier this month removed
a floor price of $950 a metric ton for basmati rice, weeks ahead
of the arrival of the new season crop.
    "This policy change has enabled Indian exporters to offer
basmati rice at more competitive prices globally, which is
likely to drive higher export volumes," Akshay Gupta, head of
bulk exports at KRBL Ltd  KRBL.NS , told Reuters.
    The minimum export price (MEP) posed a barrier to exporting
certain basmati rice grades, and its removal has opened up
opportunities for global buyers to access the full range of
options, said Gaurav Bhatia, director at DD International, one
of the top basmati rice exporters.
    India and Pakistan are the only growers of premium-grade
basmati rice, and the Indian restrictions helped Pakistan gain
market share in some categories. 
    However, with the removal of the MEP, India will be able to
reclaim that lost share, said Dev Garg, the director of
ViExport, a New Delhi-based exporter.
    India's basmati rice exports during April to July, the first
four months of the fiscal year, jumped 20% from a year ago to
1.9 million metric tons despite the MEP.
    The country exported a record 5.2 million tons of rice last
fiscal year as Canada, Iraq, Oman, Saudi Arabia, and the United
Kingdom raised purchases, offsetting the impact of lower buying
by Iran.
    Basmati is not widely consumed in India, and the government
does not buy the variety to build state reserves, unlike common
grades of rice.
    India's basmati rice production is expected to rise by
10-12% this year because of a favourable monsoon, which could
further help New Delhi in increasing exports, said KRBL's Gupta.

 (Reporting by Rajendra Jadhav and Mayank Bhardwaj; Editing by
Mark Potter)
 ((rajendra.jadhav@thomsonreuters.com; +91-22-68414378 ; https://x.com/Rajendra1857))