Macro Economy

India’s rice output to fall, Pakistan’s to rise

MR Subramani Chennai | Updated on January 23, 2014 Published on January 23, 2014


Indian exports also likely to suffer at the hands of other rice producers

India’s rice production is likely to be lower at 103 million tonnes (mt) this crop year to June, while exports could drop by 0.5 mt, according to the US Department of Agriculture Economic Research Service.

Pakistan, on the other hand, will see its production and exports rise by 0.4 mt, the service said in its Rice Outlook. The projection for rice production is against last year’s 104 mt and a record 105.3 mt the year before.

Adverse weather

Though area under rice increased this year in India and China, lower yield in both the countries is seen as the factor behind lower production. “The yield decline is partly due to adverse weather conditions,” the outlook said.

Three cyclones affecting rice growing areas in Andhra Pradesh and Odisha; and deficient rainfall in West Bengal, the biggest rice producer in the country, are seen as reasons for the fall in production.

The Agriculture Ministry is yet to make any projection on rice production for this crop year, though it sees total foodgrain production exceeding 260 mt. It had projected production at 92.32 mt for the current kharif marketing season against 92.76 mt a year ago.

Raising milled production of rice to 471.1 mt for the current crop year, the Outlook pegged Pakistan crop higher at 6.4 mt against 5.8 mt last year. Though exports from India are expected to be lower, it will still continue to top the global exporters’ list at 10 million tonnes. Last year, it is estimated to have shipped out 10.5 million tonnes.

Export growth

Vietnam, Thailand and Pakistan are expected to witness growth in rice exports this year. Global rice export growth is seen driven mainly by West Africa and China. West Africa is a major buyer of Indian non-basmati rice in recent years.

The views of rice trade on export prospects are mixed. Vijay Setia, former President of All-India Rice Exporters’ Association, said regular demand for non-basmati from West Africa and for basmati from the Gulf, US and Europe will result in higher exports.

“We are one of the most competitive origins in the rice market and we see demand from every source,” he said. India exports rice to about 140 countries.

RS Seshadri, Director of Tilda Riceland, said that there was a possibility of exports slipping a bit this year. However, non-basmati exports could make up for an expected drop in sales to Iran.

Thailand factor

India’s exports have been helped by a weak rupee and a rice procurement programme in Thailand at rates that are higher than global prices. Besides, India also enjoysfreight advantage in shipping to Gulf and West Africa.

The outlook said that Thailand’s exports could rise to 8.5 mt from 6.7 mt this year. Vietnam’s exports could rise to 7.5 mt from 7.2 mt. Currently, India’s 25 per cent broken white rice is quoted at $350-360 a tonne, Thailand is quoting it at $390-400 and Vietnam at $375-385. Pakistan’s quote for the variety is $345-355 a tonne.

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Published on January 23, 2014
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