Industry body calls for broken rice exports as stocks hit nine times target

India needs to allow the export of 100% broken rice after inventories of the grain reached a record high at the start of February, nearly nine times the government's target, exporters told Reuters.

Exports of 100% broken rice could help reduce stocks in the world's biggest exporter and enable poor African countries to secure the grain at lower prices, as well as support Asian animal feed and ethanol producers that rely on the grade.

"The government has way more rice than needed, so there's no issue with supply. Given that, they should allow exports of 100% broken rice," said B.V. Krishna Rao, president of the Rice Exporters' Association (REA).

The REA has requested the Ministry of Commerce and Industry to lift the ban. India's Ministry of Commerce and Industry and Ministry of Consumer Affairs, Food and Public Distribution did not respond to a request for comment.

India banned exports of 100% broken rice in September 2022 and then imposed curbs on exports of all other rice grades in 2023 after poor rainfall raised concerns over production.

However, the supply situation has now improved after the country harvested a record crop, which allowed New Delhi to remove curbs on exports of all grades except 100% broken rice.

State granary reserves of rice, including unmilled paddy, totalled 67.6 million metric tons as of Feb. 1, compared to the government's target of 7.6 million tons, data compiled by the Food Corporation of India (FCI) showed.

The government has allowed the FCI to sell some grades of rice for ethanol production in India because supplies are comfortable, and it should now lift the ban on broken rice exports, said Himanshu Agrawal, executive director at Satyam Balajee, a leading rice exporter.

India exported 3.9 million metric tons of broken rice in 2022, mainly to China for animal feed and to African countries such as Senegal and Djibouti for human consumption.

Broken rice is a byproduct of milling, and African countries are seeking it because it is cheaper than other grades, said the REA's Rao.

India's main competitors in the rice market are Vietnam, Thailand, Pakistan and Myanmar.