Amid the setback faced by the Indian basmati exporters over stalled shipments due to the ongoing US-Iran standoff, the prices of non-basmati paddy are holding firm and rising in some local markets after reports of crop damage following last year’s heavy rainfall and subsequent flooding in major growing areas have surfaced, Business Standard reports.
After the advisory by All India Rice Exporters Association (AIREA) to suspend basmati shipments to Iran for the time being, the prospects of basmati trade had come under the cloud which reflected in the fall in its prices on the Indian Commodity Exchange (ICEX).
Iran is the largest buyer of Indian basmati and shipments had stood at nearly $1.5 billion in 2018-19.
However, non-basmati paddy (grade III) was trading at Rs 2,440 per quintal today, up 5.62 per cent compared to Rs 2,310 per quintal a month back on December 9, 2019. At other grain markets, paddy was trading at Rs 2,350 per quintal, up 9.30 per cent over the past month.
According to National Rice Research Institute (NRRI), parts of India had witnessed abnormal rainfall during Kharif season 2019-20 and consequently, the rice production was expected at 90 million tonnes (MT), 12 per cent down from last year’s production estimate of 102 million tonnes.
Besides, heavy flooding due to consistent rains during November 2019 resulted into extensive damage to the Kharif cropped area, including paddy, in 15 States, including major rice-producing states of Maharashtra, Karnataka, Punjab, Madhya Pradesh, Uttar Pradesh etc.
Meanwhile, there were also reports of the recent spells of untimely rainfall in some states, including the coastal areas of Odisha impacting paddy procurement in the ongoing Kharif marketing season 2019-20.
Local reports claimed millers in a few Odisha districts were not lifting the harvested paddy from the ‘mandis’ citing lack of properly covered storage capacity due to rainfall. In the current season, Odisha is targeting paddy procurement of 6 million tonnes, of which only 1.2 million tonnes could be procured till January 1, 2020, compared to more than 10 million tonnes and 2.7 million tonnes in Punjab and Uttar Pradesh respectively. Basmati paddy prices have also risen by 2 per cent following reconciliatory tone on the Gulf crisis by the US president, Donald Trump, yesterday.