Exporters expect Iran to issue fresh Basmati rice permits by Dec

Iran, the biggest buyer of Basmati, had stopped fresh import licences in Oct 2014, citing high pesticide content and self-sufficiency

After a gap of more than a year, Iran is expected to issue fresh licences for import of Basmati rice from India over the next two months.

“We have got indications from importers in Iran that they may issue fresh licences from December or January,” said Rajen Sundaresan, executive director, All-India Rice Exporters’ Association (AIREA).

Iran had stopped issuing fresh licences for Basmati import since October last year, citing reasons such as high pesticide content and self-sufficiency in production. Traditionally, Basmati is India’s top agri-export commodity and Iran is its biggest buyer. As a result of Iran’s reluctance, Basmati export has taken a major hit. In 2014-15, India exported 0.93 million tonnes (mt ) of basmati rice to Iran, compared to 1.4 mt in 2013-14, according to the Agricultural and Processed Food Products Export Development Authority (Apeda). The realisation from basmati exports to Iran in 2014-15 was Rs 6,759 crore, against Rs 10,976 crore in 2013-14, a fall of nearly 60 per cent.

Data from the All India Rice Exporters’ Association (AIREA) show in August 2015, India’s basmati export to Iran was valued at around Rs 192 crore, against Rs 335 crore in August last year, a fall of about 42 per cent. In terms of quantity, exports dropped to 33,554 tonne in August, from 44,022 tonne in August last year, a fall of nearly 23 per cent.

According to the Food and Agriculture Organization’s biannual report on global food markets, in 2015-16, Iran’s total cereal imports is forecast to be 14.7 million tonnes, against 15 million tonnes in 2014-15.

In 2014-15, India’s total exports to Iran were valued at $4,175 million, down 16 per cent from the previous year. About 80 per cent of India’s agriculture and processed food exports to Iran are on account of basmati rice.

Against an average monthly shipment of about 100,000 tonnes two years ago, the current basmati export to Iran is not more than 70,000 tonnes a month.