Flood-hit India, Pakistan face rising prices for basmati rice amid crop losses
Heavy rains and flooding in India and Pakistan’s basmati-growing regions have damaged crops, raising supply concerns and pushing prices higher. Punjab regions on both sides of the border, which produce most basmati, were hardest hit. Traders estimate losses of up to 20% in Pakistan, with prices already up \$50 per ton.
Heavy rain and widespread flooding in basmati rice-growing regions of India and Pakistan have raised concerns over output of the premium staple, driving prices higher on an expected fall in supply.
India and Pakistan exclusively grow aromatic basmati rice, which sells for nearly twice the price of regular varieties and is primarily imported by Britain, the Middle East, and the United States.
Floods have severely affected the crop, but with waters now receding, losses are expected to remain limited provided there is no additional rainfall, said Nitin Gupta, senior vice president at Olam Agri India.
India’s northern states of Punjab and Haryana contribute over 80% of the country’s total basmati rice production, while Pakistan’s Punjab province accounts for more than 90% of its output.
Heavy rainfall in late August and earlier this month caused the Ravi, Chenab, Sutlej, and Beas rivers to overflow, flooding these regions.
Initial assessments indicate that crops such as paddy, cotton, and pulses on nearly one million hectares were affected in Punjab and Haryana, said an Indian government official.
In Pakistan’s Punjab province rice, sugarcane, corn, vegetables, and cotton on thousands of hectares were submerged earlier this month.
The floods have hit farmers hard, just as crops such as basmati rice and cotton were nearing harvest, said Ibrahim Shafiq, export manager at Latif Rice Mills.
In India and Pakistan, paddy seedlings are usually transplanted in June-July, with harvesting starting in late September.
The industry was expecting a bumper crop, but the damage is likely to reduce supply and push basmati rice prices higher, Shafiq said.
“Conservative estimates put the damage at 20% of basmati rice grown in Pakistan … This would definitely drive up the price for basmati rice in local markets as well as international markets,” Shafiq said.
Traders have raised prices by $50 per ton over the past week, and they could rise further if supply shortages remain significant by the end of the harvest, said Olam’s Gupta.
However, some industry officials, including Karachi-based Chela Ram Kewlani, say the current price rise is temporarily fueled by reports of crop damage and is expected to ease once supply from the new season’s harvest arrive.
To Read more about Rice News continue reading Agriinsite.com
Source : Japan Times
