India’s rice exports for the current financial year are headed for a decline, both in value and volume terms, over the previous year on reduced purchases by large buyers, such as Iran and Nigeria, and drop in realisations.
Latest export trends suggest that total rice shipments – basmati and non-basmati – have declined 7.3 per cent in volumes and 18 per cent in value terms for the April-November period over the corresponding period last year.
While basmati shipments were up 23 per cent in volume terms, realisations were down 13 per cent in rupee terms and 18.5 per cent in dollar terms, on account of decline in grain prices.
Non-basmati rice shipments dropped by a fifth in volume terms and by a fourth in rupee terms. This was largely on account of stoppage of imports of parboiled rice by Nigeria due to the foreign exchange issue in the African nation.
Exports drop
“Going by the current trend, our exports may see a decline. We may end up shipping 10.5-11 million tonnes (mt) of rice, both basmati and non-basmati put together this year,” said Rajen Sundaresan, Executive Director, All India Rice Exporters Association. India had exported a total of 11.92 mt rice in 2014-15.
Basmati shipments to Iran, the largest buyer of the Indian aromatic rice variety in recent years, have dropped 25 per cent to 3.9 lakh tonnes during the April-October period of the current financial year against 5.18 lakh tonnes in the corresponding period last year.
Iran, which had stopped issuing fresh import permits for basmati in November 2014, began issuing new permits from December 2015, Sundaresan said.
As a result, basmati shipments were likely to pick up in the coming months. However, the quantum of permits issued by Iran so far could not be ascertained.
“Our basmati shipments, in volume terms, may increase by about 10 per cent this year, while in value terms there could be a decline of 20-25 per cent on lower realisations,” said AK Gupta, Director, Basmati Export Development Foundation.
Competing countries
Non-basmati rice exporters, who rely mainly on the African markets, are not optimistic about the outlook for exports in the absence of demand from Nigeria and the firming trend in domestic prices. “The market is not very buoyant because of low prices in countries, such as Pakistan and Vietnam,” said BV Krishna Rao, Managing Director of Pattabhi Agro Foods Pvt Ltd, a large rice exporter in Kakinada.
Rao said Indian rice is not competitive in the global market compared to rice from Thailand and Pakistan. The Centre should provide some incentive to rice exporters to help maintain their market share, he added. Rao expects the overall non-basmati shipments to be in the region of around five million tonnes this year.
Tejinder Narang, a grains trade analyst, said a depreciating Thailand currency (baht) will pose a challenge to Indian exporters, who are already battling a firming trend in domestic rice prices. “Lack of demand from Nigeria is bound to impact Indian exports,” he added.
Source :.thehindubusinessline.com
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