Strong monsoon rains have buoyed top rice exporter India’s prospects amid competitive prices and expectations of a record summer crop, a top trade official told indoasianommodities.com.
Exports of premium basmati rice have notched an 11% growth between April and June. Though data is not yet available for July and August, indications are that the trend has been maintained, according to Vinod Kaul, executive director at All India Rice Exporters Association.
Indian rice exports have strongly recovered since December last year due to highly competitive prices compared to other origins, according to the US Department of Agriculture, adding that there has been a steady stream of export demand.
Assuming no significant change in the current price parity of Indian rice versus other origins, and steady international demand, marketing year 2019/20 rice exports are estimated to reach 11 million metric tons and 2020 exports at 11.5 million metric tons, according to USDA’s Global Agricultural Information Network (GAIN). Marketing year ends September.
The marketing year 2020/21 export forecast is estimated at 11.5 MMT, due to improved domestic supplies on forecasted record harvests.
Lower export prices
Kaul said that Indian rice export prices are currently about $20-$25/ton lower than that of rivals like Vietnam, which has emerged as the second-largest exporter after floods ravaged Thailand’s crop. Indian rice exports are quoting around $390/ton on average.
Despite supply disruptions due to a nationwide lockdown, exports of the grain from various ports have now nearly normalised, Kaul said.
Indian rice exports’ robust performance comes despite a a 60% drop in April-June shipments to Iran, which has traditionally been a leading buyer of Indian rice.
That has been offset by stronger demand for Indian basmati rice from other Middle East nations, while African nations have been buying large quantities of other Indian rice varieties.
“So far it’s a good scenario and we hope it will continue next month when the new crop will come in,” Kaul said.
Rice is planted in May-June in India and harvested in September-October.
The met department has predicted that there are chances of a La Nina weather phenomenon that can trigger heavy rains and damage some of the mature crop, but so far chances of a setback to a potentially fourth season of record harvest appears small.