Indian non-basmati rice exports are set to get further impetus with China and Bangladesh, apart from a couple of South-East Asian countries, looking to buy a good volume of the food grain.
“China has bought about 60,000 tonnes so far from two (rice) mills. Their authorities inspected these mills and cleared them for shipments,” said Rice Exporters Association (REA) President BV Krishna Rao.
More importantly, Bangladesh is looking to buy more which could boost rice shipments further from the country.
“The last time Bangladesh bought rice from India, non-basmati exports touched a record 8.6 million tonnes. Now, it has come back again and we expect shipments to surge to new highs,” said Rao.
Indian rice exports for the January-October period of the current calendar year have already exceeded the shipments for the whole of last year. Over six million tonnes have been exported during January-October against 5.1 million tonnes in the entire 2019.
This year, rice exports, including basmati, are exported to top 14 million tonnes.
“China will end up buying 0.5 million tonnes a year going by current trends. Such a possibility exists in the long-term,” Rao said.
Export sources in the industry said that China’s agricultural status was a mystery, given the vagaries of weather it had been facing in the last five years.
“No one is sure about China’s actual stock status with regard to rice and other food commodities. Either rain or drought has affected one or the other part of that country over the last five years,” a trade source said.
China would not want to be tied down by a single supply source and prefers to have a wide range of suppliers. Thus, it could be looking at India to supply anywhere between 0.5 to one million tonnes annually in the long term.
China, however, has opted for rice that is priced lower. It has bought white rice 100 percent broken that is being quoted around USD 320 (Rs 23,850) a tonne. Other grades such as white rice 25 percent broken and 5 percent are ruling between USD 330 (Rs 24,600) and USD 360 (Rs 26,800) a tonne free-on-board (f.o.b.)
In comparison, prime competitors Thailand and Vietnam offer their rice at over USD 400 (Rs 30,000) a tonne.
Unconfirmed reports said that China had bought a good volume of Indian rice through third countries with trade sources not ruling out even trading on high seas.
The other significant development is Bangladesh importing India parboiled rice.
As Bangladesh’s rice production has been affected by cyclone and rains, it is facing short-supply of rice.
“Malaysia and Indonesia have also come forward to buy Indian rice,” said Rao.
Both these countries have been looking at nearby Thailand and Vietnam for their supplies till now. But drought last year in Thailand and Vietnam concentrating on meeting the Philippines demand, have forced both these countries to look at India.
Malaysia and Indonesia are already importing sugar from India, while export palm group of oils to the sub-continent.
Trade sources said India could now face challenges from Pakistan and Myanmar in meeting Chinese demand. Paddy has begun arriving from the recent crop in both countries, the sources said.
While China would prefer to buy rice from Pakistan given the close relations between them, rice is smuggled across from Myanmar into China.
Since India is in the numbers game now, its exports are proving to be competitive in the global market.
India’s non-basmati exports have also been aided by huge stocks and projections of a record Kharif paddy production.
In April, when demand for rice exports picked up, Food Corporation of India (FCI) had 32.24 million tonnes in its warehouses besides unmilled paddy of 25.24 million tonnes, which could yield 16.91 million tonnes of rice.
FCI rice stocks since then dropped to 22.19 million tonnes, while it had 10.97 million tonnes of paddy stocks that could yield 7.3 million tonnes of rice. In addition, the Union government procured 27.33 million tonnes of paddy that can yield another 18.3 million tonnes of rice.
According to the first advance estimate of foodgrain production for 2020-21 released by the Ministry of Agriculture, Kharif rice production has been estimated at 102.36 million tonnes against 101.98 million tonnes last year.
“The new customers such as China and the South-East Asian countries will now add to the already 170 nations that we export rice to across the world,” Rao said.
West Asian countries, particularly those in the Gulf, and North African nations such as Senegal and Benin are main buyers of Indian rice, particularly the parboiled variety.
Source:- Moneycontrol.com
