NEW DELHI: India’s Basmati exports this year are likely to hit a record 3 million tonne despite subsidy withdrawal from Saudi Arabia, setbacks to exports in Iran and the Dubai financial crisis.
Exports up to December 2009 stood at 2.3 million tonne and could easily go up substantially, industry sources said, although the price of the top quality rice may have dropped in the export markets compared to last year.
“Exports will be in excess of 2.5 million tonne up to March 31,” Vijay Arora, president of the All India Rice Exporters Association (AIREA) said, pointing out that production this year was up by 1.5 million tonne to 4.5 million tonne despite a drought that struck output for non-Basmati rice.
In 2008-09, around 2.31 million tonne of Basmati was exported but a good portion of the exports was high value non-Basmati rice. The exports were much higher than the 1.51 million tonne registered in 2007-08.
Significantly, the Centre put off an urgent decision on whether or not to import rice (even as global prices shot up on news of India’s need to import) to boost domestic market supply and tone down prices until March this year, following an assessment of both available grain stocks and the second advance crop estimates due in February-March.
The second estimates provide the first indications of what the year’s kharif crop (for the 2010-11 kharif marketing season or KMS starting October) may look like.
That the decision to delay high priced rice imports may have been an intelligent one became apparent not only in the heavy over-stocks of wheat with the Centre now, but more clearly, in the fact that the prices for Thai Hom Mali rice have gone up further since December.
The price of Grade A rice (2009-10 crop) moved up between just December 2 to January 6 to $1021/tonne from $1006/tonne while the price of the same quality for the previous year’s crop remain static at $1116/tonne in the period, after having dropped $3/t to $1113/t on December 23, 2009.
This, despite Thailand having offloaded overstocks of rice from that year at heavy discounts on to the global market to make way for the new crop. PM Manmohan Singh’s meeting with state CM’s gears up to urgently offload massive Central wheat stocks on to them in an urgent dual bid to reduce overload in FCI godowns before the new marketing season begins in March and to temper open market foodgrain prices.
The Centre is under pressure to offload around three million tonnes of wheat in the next two months in order to make way for the impending new crop, which is expected to be good.
Source : The Economic Times