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India's non-basmati exports rise 34% on Africa's import demand

13-Apr-2018
India's non-basmati exports rise 34% on Africa's import demand

India’s non-basmati rice export jumped 34 per cent over a year before in the period between April 2017 (start of the earlier financial year) and January 2018.

The prime reason given is that Africa’s import demand shifted to here from Thailand, on cost competitiveness. Basmati export, however, remained stable.

Data from the Agricultural & Processed Food Products Export Development Authority (Apeda) showed non-basmati export at 7.01 million tonnes worth nearly $2.89 billion for these 10 months, compared to 5.25 mt valued at $1.97 billion in the same period a year before.

Apart from geographical advantage, currency movement is a major determinant for rice export, in comparing Thailand and India. Till a few months earlier, however, Thailand was the preferred choice for African rice importers. However, a rising Thai currency (the baht) pushed them to look for alternative suppliers.

“India has got a little extra share in world rice markets due to lower stock and shipment from Thailand. Non-basmati export from India would continue to surge for the next couple of months,” said A K Gupta, director, Apeda.

The Food and Agricultural Organization of the United Nations has estimated 33.7 mt of rice output in Thailand for calendar year 2017, a three per cent increase from 32.6 mt a year before. Production in Thailand jumped 19 per cent in 2016 from 27.4 mt in 2015.

The baht rose 9.6 per cent, from 34.35 to 31.34 against a dollar, between April 2017 and January 2018. Against that, the rupee rose two per cent, to 63.59 a dollar from 64.85 in the period.

In fact, the Thai government has forecast an 18 per cent decline in the country’s rice export to 9.5 mt in calendar 2018, from 11.6 mt the previous year.
“India and Thailand compete with each other in non-basmati export to African countries. Historically, orders shift to the former in case rice import in African countries become uncompetitive from the latter. African countries share 80 per cent of India’s non-basmati export. The appreciating baht has clearly given advantages to India over Thailand for non-basmati export,” said V K Chaturvedi, managing director at Usher Agro, a rice exporter.

In contrast, India’s basmati rice export stayed at 3.27 mt in those 10 months, on lower sales to the European Union, which consumes nearly 300,000 tonnes annually.

“Basmati is a high value product. We are expecting a five per cent increase in its export for FY18,” said Gupta. The export in 2016-17 was 3.98 mt (valued at $3.22 bn), a marginal decline from 4.05 mt (worth $3.48 bn) the previous financial year.

Rajan Sundareshan, executive director, All India Rice Exporters’ Association, says he expects India’s basmati export to see another 0.6-0.65 mt in February and March, the final two months of financial year 2017-18.

The government is asking for more exploration of basmati markets in Latin American countries.

Source:-Business-standard.com

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