Basmati export companies like Satnam Overseas Ltd (Kohinoor brand rice) and L T Overseas Ltd (Dawaat brand) are hopeful of repeating last year’s good performance this season too. India exported 3.2 million tonnes of basmati rice last year and is projected to export four million tonnes of basmati rice this year.
Prices of the commodity in international markets are high and increased sowing in this kharif season will ensure availability of paddy for exports. As a strategy to harvest better quality paddy for export purposes, some companies including Amir Chand Exports (owner of the Aeroplane brand basmati rice) have entered into buyback arrangements with farmers.
Satnam Arora, joint managing director of Satnam Overseas Ltd, said the demand for basmati rice is picking up in the international markets and Indian exporters are eyeing a bigger pie this year.
“I don’t see much impact of rain on basmati cultivation. The price of basmati is $1,000-1,500 a tonne for different varieties. Last year, it was close to $800-900 a tonne. Iran is coming up as a big importer and we are now scouting new markets in the African continent. Daawat, as a basmati brand, is doing well and we expect a 20 per cent jump in exports,” said V K Arora, managing director, L T Overseas Ltd.
“In the past few years, the awareness about basmati rice has grown tremendously and so has the demand. The acceptance of Pusa 1121 as basmati has widened the scope for exporters. Even African countries are now demanding basmati rice,” said J K Suri, chairman of Amir Chand Jagdish Kumar Exports Ltd (Aeroplane brand rice).
He added the company has a buyback arrangement with farmers for organic rice, meant for the niche market. The export price of basmati rice in the international markets is $800-1,400 a tonne, depending on the variety. The price remained close to $800 a tonne due to high supply last year.
Apprehensions regarding a decline in paddy area due to delayed and deficit rain are fading because the latest data available with government agencies shows that rice has been sown on 23.4 million hectares, compared to 19.1 million hectares a week before. The normal sowing at this point in year is 24.1 million hectares. According to Mahinder Pal Jindal, president of the All-India Rice Exporters Association, the yield of basmati rice will not be affected this year as it is grown mainly in the irrigated belt of Punjab, Haryana and Uttar Pradesh.