Government to reduce minimum export price on basmati rice to $ 950/tonne soon
The government has decided to reduce the minimum export price (MEP) for basmati rice shipments to $ 950/tonne from $ 1,200/tonne fixed on August 25, a senior official said.
A formal notification allowing exporters to register for shipments above the threshold value of $ 950/tonne will be issued by the Agricultural and Processed Food Products Development Authority (APEDA) soon.
Commerce and industry ministry is understood to have conveyed the decision on reduction of MEP on basmati rice to exporters in a meeting held late on Monday.
“With Basmati rice exports allowed above $ 950/tonne would increase exports realisation and boost farmers income,” Vijay Setia, former president, All Indian Rice Exporters Association (AIREA) and a Karnal based rice exporter said.
In August, a temporary MEP of $1200/tonne was imposed till October 15 on basmati rice shipment to restrict ‘illegal shipment of white non-basmati rice in the garb of premium basmati rice.’
The temporary MEP was extended recently till ‘further order’ leading to exporters stopping procurement of basmati paddy from the farmers fearing exports slow down because of high MEP.
“Members are advised to exercise extreme caution in the procurement and inventory holding of paddy as these are expected to significantly impact business viability and potential of basmati export at remuneration realisation,” according to a recent the advisory by Nathi Ram Gupta, president, AIREA, the apex body of aromatic rice exporter.
The commerce ministry had stated that it has received credible field reports regarding misclassification and illegal export of non-basmati white rice whose shipment was banned from July 20,2023.
According to the AIREA, the average export price of basmati rice in the last five years has been $ 975/tonne.
India has exported 2.1 million tonne (MT) of basmati rice valued at $ 2.22 billion in the April-August period of the current fiscal, an increase of 12.6% in terms of value compared to the same period previous year.
In 2022-23, the country exported 4.56 MT of basmati rice valued at $ 4.78 billion with an average price of 1050/tonne.
A committee set up by APEDA in collaboration with the agriculture ministry looked into large variations in the contract price of basmati exported in August with the lowest price being $359/tonne against the average export price of $1,214/tonne.
The report had favored reducing the MEP substantially to the exports are hampered.
Geographical Indication (GI) tagged basmati rice is grown in 70 odd districts in Punjab, Haryana, western Uttar Pradesh, Jammu & Kashmir and Uttarakhand.
The aromatic and long grain rice commands a premium in the global market. India has a share of around 75%-80% in the global aromatic rice market. Pakistan holds around 20% in the basmati rice exports.
Recommended for you
