Global demand pushes up basmati exports

India’s basmati rice exports are estimated to have jumped by 13 per cent despite a cess of Rs 8,000 a tonne, while shipment of non-basmati varieties fell by 31 per cent in the crop year ending September 2008 due to ban.

According to official sources, basmati rice exports during the 2007-08 season (October-September) are estimated at 1.19 million tonne (MT), compared with 1.05 MT in the previous season.

However, exports of non-Basmati rice are estimated to have declined to 3.2 MT from 4.67 MT during the period under review. This estimate is based on the no-objection certificate issued by the Agricultural and Processed Food Export Development Authority (APEDA).

 

The main reason for the fall in export of non-Basmati rice is attributed to the ban on shipment from April, though restrictions like imposing a minimum export price (MEP) were introduced in October 2007 when the season began.

Exporters said the decline is not much considering the fact that shipments were not allowed for six months during the 2007-08 season.

Commenting on the jump in Basmati rice export, All India Rice Exporters Association President Vijay Sethia said the shipment increased as the world had a shortage of the grain last year, which also helped exporters receive a good price despite the MEP and cess.

He demanded that the government should either remove the MEP on Basmati or reduce it to compete with Pakistan, which has withdrawn the MEP on prospects of a better harvest.

The Centre first imposed a ban on rice export in October last year, but later lifted it by introducing an MEP on both Basmati and non-Basmati rice following protests by traders, exporters and farmers.

The MEP on non-Basmati rice was raised from $650 a tonne to $1,000 a tonne in phases. The Centre has banned exports of non-basmati rice from April as part of its measures to control inflation.

In the case of basmati rice, the MEP went up to $1,200 a tonne. Besides, the government also levied an export cess of $200 a tonne on it.

Meanwhile, a report from Chandigarh said prices of non-basmati rice varieties have dipped by 30 to 40 per cent in Punjab and Haryana during this marketing season due to a ban on exports of the commodity, say traders.

With the arrival of the harvesting season, farmers are forced to sell their non-basmati varieties at much lower rates against the previous season’s rates, traders said.

At present, prices of super varieties of paddy, which fall under the non-basmati category, range between Rs 1,050 and Rs 1,200 per quintal, against the last year’s prices of Rs 1,800-Rs 2,000 per quintal, traders said.

Price of the Sharbati variety, which fetched Rs 1,700-1,800 per quintal last year, are now hovering around Rs 1,200 per quintal. Similarly, the price of the Sugandha variety stands at Rs 1,400 per quintal, against Rs 1,800-Rs 2,000 per quintal last year.

Other non-basmati and long-grain varieties such as PR 111 and PR 114 are also being sold lower than the MSP of the paddy which last year was sold over Rs 1,100-1,200 per quintal.

“Prices of non-basmati varieties have dipped just because of the wrong policies of the Centre,” Punjab Rice Exporters Association President Rajiv Setia said. Centre had banned the export of non-basmati rice in April this year to control the rising inflation.