Bengal’s premium variety aromatic rice witnesses 11% decline

West Bengal’s premium variety of aromatic rice — Gobindobhog – has witnessed a near 11 per cent decline in prices on the back of prospects of arrival of a higher crop and better quality produce. The imposition of 20 per cent customs duty has negatively impacted exports of rice thereby bringing down prices, sources said.

The old crop, which typically fetches a higher premium over the new crop because of better demand, is currently hovering around ₹42-45 a kg this year as against ₹50 a kg same time last year.

The production of Gobindobhog rice is estimated to be 5-7 per cent higher this year on the back of a better-quality crop giving a better paddy to rice conversion rate, industry insiders suggest.

Export

Production of paddy is estimated to be close to 3.25 lakh tonnes in 2022-23, as against 3.08 lakh tonnes in 2021-22. Production of rice is estimated to be close 2.01 lakh tonnes (1.80 lakh tonne) in 2022-23. The country exported close to 14,000 tonnes of Gobindobhog rice in FY21 and around 9000 tonnes in 2021-22.

Gobindobhog is non-Basmati type indigenous aromatic rice from West Bengal. The paddy variety, which got the GI (Geographical Indication) status in August 2017, is primarily cultivated in East Burdwan district in the Raina 1, Raina 2 and Khandaghosh blocks.

High production

According to Suraj Agarwal, CEO, Tirupati Agri Trade, the quality of the crop had suffered last year due to untimely rains at the time of harvesting thereby impacting prices. However, this time it is expected that both quantity and quality of production will be higher due to favourable weather conditions. The new crop will start arriving at the market by the third week of November.

“Usually in case of Gobindobhog the price of the old crop rules higher around this time of the year. But this year we are seeing the prices are suppressed as the production of new crop is estimated to be higher and of better quality,” Agarwal told businessline.

Typically, 100 kg of paddy gives close to 58 kg of Gobindobhog rice. But this year the industry expects the conversion rate to be much higher with 100 kg paddy yielding close to 62 kg rice.

The premium variety aromatic rice has been witnessing a steady rise in prices over the last few years backed by a firm demand from both domestic and international markets particularly Dubai and Middle East. Hence production has also been steadily increasing as farmers are earning better returns on cultivation of this particular variety as compared to the common paddy (Swarna).

There has been a steady rise in production of Gobindobhog paddy, which is a niche crop, in West Bengal. While it was largely cultivated in the East Burdwan district, however, now it is also being cultivated in some parts of Midnapore.

Driven by the prospect of earning more, farmers in Bengal have taken to cultivating Gobindobhog. The area under cultivation, which was close to 35,000 hectares in 2019-20, has gone up to close to 44,000 hectares in 2022-23.

International markets

Gobindobhog has a good demand in international markets particularly in Europe and Gulf countries. However, the imposition of 20 per cent customs duty on rice has negatively impacted the exports thereby affecting prices, sources said.

Incidentally West Bengal Chief Minister Mamata Banerjee had recently requested Prime Minister Narendra Modi to issue necessary instructions for extending an exemption of the customs duty on export of Gobindobhog rice at the earliest.

Banerjee said that along with the extension of production in areas suitable for this premium variety of rice, the state government has also been encouraging its export to create sustained demand abroad for this premium variety.

The imposition of customs duty would therefore impact the demand and domestic price of the paddy and hence on the income of farmers, she said in the letter.

COMMENT NOW