Economy

As buyers stock up, exports of cereals, processed food, spices spike

Amiti Sen New Delhi | Updated on March 23, 2020 Published on March 23, 2020

Exporters have a limited window to take advantage as demand may dip subsequently: TPCI

India's exports of essential food items such as rice, wheat and pulses as well as processed food and spices have seen a surge in March , with the Covid-19 outbreak prompting people across the globe to stock up, according to the Trade Promotion Council of India (TPCI).

The sharp increase in demand for food, however, may be followed by a slump after about three months, at least in smaller markets such as Hong Kong, as consumers may have enough supplies and may not have to make fresh purchases for some time.

“There has been a close to 100 per cent spike in the demand for essential commodities such as rice, wheat and pulses in March 2020. Other food categories such as confectioneries, sweets, organic processed food and spices have also witnessed a 15-20 per cent rise this month,” said Mohit Singla, Chairman, TPCI.

TPCI is a trade and investment promotion organisation supported by the Department of Commerce.

The rise in exports of food items in March 2020 could help India prop up exports of total goods for 2019-20, which have lagged behind last year by 1.5 per cent so far, and bring it closer to 2018-19’s exports of $331 billion.

Increase in orders

Buyers in almost all markets, including the EU, the US, Australia, New Zealand, Israel, Palestine and Egypt are increasing their orders as people stock up, Singla told BusinessLine.

For instance, Organic Tattva, a leading brand of Organic food, has reported a 20 per cent rise in demand in March, while companies such as PK Overseas and Rdr Impex Pvt Ltd have informed that the demand for rice has increased by more than 60 per cent, Singla said.

A rise in exports by 15-20 per cent has also been reported by ready-to-eat confectionery manufacturers Bhikharam Chandmal and Bikaji, owing to stockpiling, but they said demand would dip subsequently.

Availability of containers

“The coming few months are crucial for India in terms of leveraging its advantage in exports. Exporters and the government have to work together in overcoming obstacles such as availability of adequate number of containers,” Singla said. Exporters are also trying to deal with the uncertainty of clearance of containers at foreign ports by sending a limited number of shipments at a time.

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Published on March 23, 2020
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