Basmati shipments seen at record $5.5 bln in FY24

Informist, Tuesday, Jun 6, 2023

By Sandeep Sinha

MUMBAI – For the first time ever, India's basmati rice exports are set to exceed $5 bln in 2023-24 (Apr-Mar), said All India Rice Exporters Association Executive Director Vinod Kaul.

"The country's basmati rice exports in 2023-24 are likely to touch $5.5 bln in value, against $4.8 bln achieved in 2022-23," Kaul told Informist.

Exports in the current financial year got off to a good start, with basmati rice exports in April rising 32.8% on year to 424,650 tn. In value terms, the growth was nearly 45% at $470 mln.

Kaul said that in April, basmati rice exports to most destinations recorded growth.

The aromatic rice has huge demand in West Asia, and the region accounts for nearly 77% of the total basmati rice exports from India. Iran and Saudi Arabia are the biggest importers, both in value and volume terms.

"Over the past few years, our export of basmati rice has been hovering around 4.5 mln tn. But due to various reasons, export dropped to 3.8 mln tn in FY22 but again picked up to 4.5 mln tn in FY23. We anticipate that in the current financial year also, we will be able to sustain the usual export trend," Kaul said.

Average monthly basmati rice exports for the last five years stand at 350,000-360,000 tn, he said.

India is the largest producer and exporter of basmati rice, accounting for 70% of global production. It produces about 9 mln tn of basmati rice in a year, with domestic consumption and exports each accounting for half.

"The fiercest challenge that is being faced in basmati rice exports over the past few years is the trend in various importing countries adopting European Union-at-par norms of maximum residue levels of pesticides. This causes compliance issues as production is generic and cannot be on a country-specific requirement basis," said Kaul.

"Proactive and consistent liaison with different countries to convince them about the unrealistic approach in adopting EU-type norms of 0.01 parts per million for most pesticides would be the first and foremost action plan," he said.

This year, Kaul does not expect major competition from Pakistan in the export market, as floods in the country damaged the crop. Also, in a recent forecast, the Food and Agriculture Organization's Global Information and Early Warning System said Pakistan is at risk from the El Nino weather phenomenon this year, which is likely to lead to excessive rainfall.

"It is not always that El Nino has a negative impact, and I only wish that it does not cause any damage to our crop," Kaul said.

Pakistan traditionally competes with India in the basmati exports market.

Basmati rice exports account for about 18% of India's total agricultural produce exports, according to data collated by the Agricultural and Processed Food Products Export Development Authority.

In Jan-May, the average price of Pusa basmati was $1,543.3 per tn, compared with $1,302.0 per tn in the same period last year, the United Nation's Food and Agriculture Organization said in its monthly report.

Farmers have shifted to the Pusa basmati variety, as this requires less water compared to traditional varieties and yields are higher than that from traditional tall basmati. End

Edited by Avishek Dutta

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