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Wednesday, Mar 13, 2002

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Rice exports up despite fall in global demand

G. Chandrashekhar

MUMBAI, March 12

DESPITE a small anticipated decline in global rice trade in 2002, the country's export performance is expected to show considerable improvement thanks to the Government support. The pace of shipment has been strong in recent months with sales to African and East Asian destinations.

Abundant supplies in India following massive domestic stocks of about 30 million tonnes and near-record production of 89 mt (up 3 mt from last year) have forced the Government to continue to subsidise rice exports. This is starting to yield results.

India's exports have mainly been of parboiled rice for the past several months. The Government began subsidising exports since the middle of last year following which Indian exporters have been aggressive sellers. Prices of this category have dropped since October 2001 because of Indian sales pressure. India also supplies low quality rice to sub-Saharan Africa.

India's rice shipments are projected to show a sharp recovery in the current year. From an average level of 1.5 mt each in calendar year 1999 and 2000, exports are projected to aggregate 2.5 mt during 2002, on current reckoning.

World rice market: Global rice trade in 2002 is expected to shrink by some 6 per cent to 23 mt. The decline is primarily due to weaker projected imports mainly for Nigeria (down by a third to 1.2 mt) and the Philippines (down 15 per cent to 8 lakh tonnes).

Bangladesh which is India's closest market for rice is expected to import about four lakh tonnes this year, down from 5 lt of last year following higher domestic production of 25.5 mt as a result of higher yield and expanded area.

The decrease in import requirement of some markets more than offsets the anticipated higher import requirement of Indonesia (1.6 mt), Iran (one mt) and Russia (3.5 lt), according to the US Department of Agriculture. Meanwhile, global rice production is estimated at 395.3 mt, some 2 mt below last year, mainly on account of lower output in China. World consumption, on the other hand, is projected at a record 405.5 mt, slightly higher than last year, leading to an inevitable drawdown of global stocks to the extent of 11 mt to 126 mt.

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