Rice exports likely to double to 9mt

Rice exports are likely to double to 9 million tonnes this year on higher productivity and better realisations in the overseas markets.

According to sources in the Food and Agricultural Organisation (FAO), India exported 4.4 million tonnes of basmati and non-basmati rice last year. Of this India exported 1 million tonnes of basmati and 3.5 million tonnes of non-basmati rice to neighbouring and West Asian countries.

Despite the floods that devastated parts of northeastern states including Bihar and Uttar Pradesh, industry sources estimate a bumper rice crop with a 10-15 per cent rise in production than last year's output at 91 million tonnes.

The three worst flood-affected states are important rice producers, roughly accounting for a quarter of India's total paddy area and production. Preliminary reports indicate that about one million hectares of cereal land have been submerged in Bihar alone. "We are expecting at least 100 million tonnes of rice this year as rains are always good for paddy, which is a rainfed crop," said Sharad Maru, president Grain Rice & Oilseed Merchant Association (GROMA).

In contrast, maize which had already been sown in the flood-hit states has been affected, said V K Chaturvedi, MD, Usher Agro, a rice processor with its existing plant in Bihar.

Taking a cautious approach on grain output, FAO Director-General Jacques Diouf recently said that rainfed agriculture in semi-arid and sub-humid regions is mostly at risk because of the fast changing climate in the country.

Consequently, India could lose 125 million tonnes of its rainfed cereal production, equivalent to 18 per cent of its total production, he warned.

Floods can only delay paddy sowing, which may extend the crop period. This necessarily means that if paddy sowing is delayed by 15-20 days then harvesting will also be delayed by the same period. But, torrential rains have always been good for the crop like paddy, said Chaturvedi.

According to the FAO report, India's rice production was estimated at 78.54 million tonnes in kharif season and 12.51 million tonnes in 2006-07 rabi season.

Asian countries led by Indonesia, Bangladesh, Nepal and Vietnam are likely to increase imports. Indonesia is believed to be the major importer, where restrictions on rice imports had to be eased to check soaring domestic prices and to rebuild stocks.

As a result, Indonesia may buy 2 million tonnes of rice, substantially above the 800 000 tonnes it is estimated to have bought in 2006.

The FAO report also suggests that shipments to Bangladesh, Nepal and Vietnam are also foreseen to increase, while those directed to the Islamic Republic of Iran, Iraq, Malaysia and the Philippines may decline.

Global demand for the Indian rice may take its toll on prices that are likely to increase substantially towards the end of this year.