Basmati rice exports to Iran likely to resume soon

Iran had stopped issuing import permits since October 2014

After several rounds of discussions, Iran is likely to start issuing permits to Indian exporters, paving the way for basmati exports.  

“India may resume exports of basmati rice exports to Iran early next year,” said Ajay Sahai, Director General of the Federation of Indian Export Organisations (FIEO).

Basmati rice exports from India in 2013-14 are likely to decline 10 per cent due to Iran’s temporary stoppage of fresh order issuances. The country has not issued any fresh import permits after October 2014. However, execution of existing and past orders has continued.

“India does not face any ban in terms of basmati rice exports to Iran. Only thing is Iran has not issued import permits, which it does to any country before bringing consignments into its territory, since October due to oversupply. During past years, Iran had imported large quantity of basmati rice from India,” said A K Gupta, Director, Agricultural & Processed Food Products Export Development Authority (Apeda).

Once, import permit is issued, India would commence exports of basmati rice to Iran, said Gupta.

India’s overall basmati rice exports declined by over six per cent at 2.57 million tonne during April and December 2014 as compared to 2.74 million tonnes reported in the corresponding period last year.

In value terms, overall basmati rice exports declined by 2.64 per cent to $3373.23 million in the first nine months of the current financial year as compared to $3465 million in the same period last year. But average per tonne realisation increased to Rs 80,000 this year as compared to Rs 75,000 during the previous year.

While country-wise bifurcation is not available, experts believe, exports to Iran has declined by 15-20 per cent this year.

Iran is the largest basmati rice importer, accounting for around 60-65 per cent of total premium rice exports from India. India exported 1.44 million tonne of basmati rice worth $1,834 million to Iran in 2013-14. During 2012-13, however, basmati rice shipments to Iran totaled 1.08 million tonnes worth $1187 million.

Basmati was India’s second largest export commodity after buffalo meat.

A recent report by the Food and Agriculture Organization of the United Nations estimated Iran’s rice output in 2014 at all time record of three million tonnes as compared to 2.9 million tonne and 2.8 million in the two subsequent previous years. Total cereal output in Iran, however, is estimated to decline by 4.4 per cent to 20.4 million tonne in 2014 as compared to 21.4 million tonnes and 21.3 million tonnes in 2013 and 2012, respectively.

Apart from basmati, India exports non-basmati rice and other cereals to Iran to the tune of around $150 million annually.