Rice exports surge on strong demand, dip in Thai stocks

Strong demand from neighbours Bangladesh and Sri Lanka, and steady off-take from traditional buyers in Africa has led to a surge in the country’s non-basmati rice exports, which are likely to rise to new highs this financial year.

Besides, the depleted stock levels in Thailand — a major exporter — has helped India gain and consolidate its share in the global market, trade sources said.

Shipments soar 40%

For the first nine months of the current fiscal, the non-basmati exports have registered a growth of 40 per cent in volumes at 63.38 lakh tonnes (lt) and 46 per cent increase in value terms at ₹16,803 crore over corresponding period last year.

Non-basmati rice shipments, after reaching a record 82.74 lt in 2014-15, had dropped in the subsequent year to around 64.64 lt. However, over the past couple of years, the Indian shipments have staged a rebound. Steady growth in domestic output of over 100 million tonnes annually, has resulted in a surplus aiding the shipment trend since 2011-12, when the exports curbs were removed.

Output, stocks

For the current 2017-18 year, the government is targeting a rice production of 108.5 mt , marginally lower than the fourth advance estimates of 110.15 mt during 2016-17. Rice stocks with the Food Corporation of India stood at 198.93 lt as on February 1 this year against 170.28 lt in the corresponding period last year.

Similarly, the unmilled paddy stocks in the Central pool stood at 210 lt as on February 1 this year (183.14 lt).

“The liquidation of old stocks by Thailand has led to the increased demand for Indian white rice. As a result, we expect the shipments to be over 8 million tonnes this year,” said BV Krishna Rao, President of the Rice Exporters Association. Further, the decline in Thai rice stocks has led to a firming trend in prices, resulting in better realisation for the Indian exporters.

Prices have moved up by around $100 per tonne as compared to a year ago, Rao said. The average prices realised by the Indian exporters stood at $411 per tonne for April-December this year, as against last year’s $378 per tonne.

Bangladesh buying

Bangladesh, which bought aggressively during April-October period, has slowed down a bit in the past three months with the arrival of domestic crop. Rao estimates that Bangladesh could have bought up to 2 million tonnes of rice, while close to a million tonnes would have been purchased by Sri Lanka, while demand has been steady from African nations.

“The average exports during January-March period over the past five years stood at around 1.84 million tonnes. Assuming this is achieved this year too, the total exports would be over 8 million tonnes. The shipments may touch the historic high or near to historic highs, if there are no more surprises from Bangladesh during this period,” said Amit Bharadwaj, CEO of Level A Commodities.

Basmati exports for April-December stood at 2.9 million tonnes valued at $2.9 billion or ₹18,758 crore.

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