India is currently the world's top exporter of rice, making up over 40% of the global rice trade, and the world's second-largest producer of the grain after China.
Current Scenario Of The Indian Rice Export Markets
According to analysts, rice production in 2023 will be at its lowest level in 20 years. The global rice shortage for 2022-23 is expected to be around 8.7 million tonnes.
A ban on the export of non-basmati white rice was enacted by the Indian Union government on 20th of July as a result of the recent, ongoing price increase. According to the Ministry of Consumer Affairs, the ban would help to "allay the rise in prices in the domestic market" and ensure "adequate availability" of non-basmati white rice in the nation.
Since India is the second-largest producer of the food staple in the world, Eve Barre, an economist for trade credit insurer Coface, predicted that the global rice supplies would drastically tighten. He continued by saying that because Bangladesh and Nepal are major export destinations, these nations would be the hardest hit by the ban.
Reason For India’s Rice Export Policy Changes
According to Radhika Rao, a senior economist at DBS Bank, “rice inflation has already accelerated from an average 6% year-on-year last year to nearly 12% in June 2023.”
The Ukraine war's impact on supplies, along with unfavorable weather in China and Pakistan, are to blame for the commodity's shortage. Rice production in Pakistan has reportedly been estimated to be down 31% year over year, according to a USDA report.
Furthermore, given that Asia is home to 90% of global rice consumers, prices there are generally on the higher side.
With a spatially uneven and insufficient monsoon in several states of the nation, rice and pulses have also been put at risk. As of July 14, overall kharif sowing was still low, falling by 2%. The cause has been attributed to insufficient rains in West Bengal, a major rice producer, as well as Maharashtra and Karnataka, which together produce more than half of the nation's production of pulses.
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