India Rice Exports In Shock: 6% Decline As West Asia War Hits Trade
India’s rice exports fell 6% year-on-year to $1.01 billion in April 2026 due to West Asia shipping disruptions. Freight costs surged tenfold to $5,000 per container, while Gulf shipments dropped 49% in FY26. Despite this, USDA expects India to lead global rice exports with 25 MT in 2027.
Rice is one of the largest agri-product shipment of India. Amid the West Asia Crisis, India’s rice exports continue to be hit with shipments values dropping by 6% in the month of April.
India shipped grain valued at $1.01billion. There has been a 6% year-on-year decline. Since the Middle East Conflict disrupted Basmati rice exports to Gulf countries such as Iran and Saudi Arabia. Notably, Iran is a major destination of rice exports for India. Undoubtedly, India is the world’s largest rice exporter.
A major Basmati rice exporter stated: India’s rice export sector is currently facing serious challenges as global market conditions weaken. Rice exports recorded a noticeable decline”.
Rice exports shipments recorded a tenfold freight surge
The West Asia war has affected the shipping lanes severely in the Red Sea and the Strait of Hormuz, leading to freight surges and insurance premiums, surging the export costs. According to rice exporters, ocean freight for rice exports to the Gulf region has increased to $5000 a container since March 2026. Earlier, it used to be $500/a 25-tonne container. It simply reduces the exporters’ margins. Furthermore, the exporters said that the ongoing conflict in Middle Eastern regions has severely disrupted shipping operations. Notably, these Middle Eastern regions are the crucial transit routes and destination markets that account for approximately 70% of India’s Basmati rice exports. Whereas Non-basmati rice exports, which are generally sent to Africa, the USA and Europe, have remained intact so far. Surprisingly, the rice export value, including Basmati and non-Basmati rice varieties, dropped by 7.5% year-on-year to $11.53 billion in the financial year 2026.
A sharp fall in rice shipments to Gulf nations
Agricultural and Processed Food Products Exports Development Authority (APEDA) stated that rice exports to Gulf nations such as Saudi Arabia, Iran, Iraq, the United Arab Emirates, Kuwait and Oman have recorded a sharp 49% fall in the financial year 26 compared to the last year. India has been the largest rice exporter (Basmati and non-Basmati) in the last decade. The country holds a market share of nearly 45% in the rice trade.
Significantly, India exports both Basmati and non-Basmati rice varieties to more than 140 countries, in Asia, the Middle East, Europe, and the U S. There is no doubt in this fact that the country faces competition from other rice-exporting countries such as Pakistan and Thailand. However, India remains at the top in the category of both the world’s largest rice producer and exporter.
What’s USDA’s rice outlook in May 2026?
Interestingly, the United States Department of Agriculture (USDA) is forecasting a surge of 1.8 million tonne (MT) in global rice exports in the 2027 calendar year at a record 63.1 MT. In the rice outlook in May 2026, it mentioned that Rice exports will continue to be led by India with 25 MT or 40 per cent of global trade, given its ample exportable supplies and competitively priced exports. Furthermore, the report highlighted that global rice production in 2026/27 is projected at 537.8 MT. Notably, it is low nearly 5 MT from the previous year after 10 consecutive years of growth. Subsequently, “India is projected to remain the world’s largest producer, surpassing China for the third consecutive year.
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Source : IREF
