Curbs on rice exports, good harvest expected to cool domestic prices, say experts, ET Retail

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New Delhi: Imposed restrictions on the export of basmati and non-basmati white rice coupled with a hopeful good harvest are expected to cool off rice prices in the country ahead of the upcoming festive season and elections next year, said industry executives.

The government last year in September banned the export of broken rice, followed by a ban on exports of non-basmati white rice in July this year and enforcement of a minimum export price of $1200 per tonne on basmati rice.

Shammi Agarwal, director, Pansari Group commented that with the export ban, domestic prices of non-basmati white rice have seen a fall of 7-8 per cent.

“Good rains and harvest along with continuation of the imposed ban, will lead to lower domestic prices in the coming months,” said Akshay Gupta, head – bulk exports, KRBL.

Sharing his views, Akshay D’souza, chief of growth and insights, Bizom said that the Indian government, through EXIM (export-import) trade measures, is trying to ensure adequate availability of rice, wheat, sugar, and edible oils in domestic markets. He opined that these measures are expected to help cool off any adverse effects of either ElNino or a rise in global prices.

“We do expect to see prices around these products to be stable as we head into the festival season this year and beyond,” D’souza said.

Rice prices in India were already up in double digits before these restrictions were imposed in July 2023. Rising fertilizer prices and uneven monsoon rains in the country until July, resulting in crop damage have also played a key role in the same.

In addition to marking the restrictions as a necessary measure to ensure lower domestic prices, D’souza said that the export ban is also a precautionary measure in case El Nino affects the rice crop that is standing, and the next cycle.

Gupta from KRBL, which makes IndiaGate Basmati rice said that the ban on non-basmati white rice was foreseen as the government has set a procurement target of 52 million tonnes during the year.

“If the crop is not good, the government was worried that they would not be able to purchase this rice. Hence, they put a ban. The oncoming crop in the month of October will decide how the government reacts to this ban,” he stated.

Industry experts also highlighted that the measures are expected to be in place until the elections in May 2024 so that inflation remains in control and India can provide food security.