The government data has revealed that India's rice exports dropped 29% in August to 644,249 tonnes, due to weak demand from African countries for non-basmati rice, among other factors.
Nitin Gupta, vice president of Olam India's rice business said, "Demand from west African countries is weak for non-basmati rice. They have bought a lot from China and don't need to buy huge volumes now". India is the world's biggest rice exporter but its shipments have plunged 27% in the first five months of the 2019/20 financial year, starting on April 1, to 3.8 million tonnes, the data reveals.
Moreover, India's biggest buyer of basmati rice, Iran has nearly stopped purchases in the last few weeks as it harvests its own crop, said an exporter based in New Delhi, who declined to be identified.
"Iran could resume buying early next year after harvesting the local crop," the exporter said.
Gupta also added that rice supplies from India's summer-sown crop are expected to improve from next month and this could moderate local prices and make exports competitive.
Last month, the government revealed that rice production from the summer-sown crop in 2019 was expected to drop 1.7% from a year ago to 100.35 million tonnes.
B V Krishna Rao, president of the Rice Exporters Association (REA) said, “Non-basmati rice exports could fall 40% in 2019/20 from a year ago unless the government provided some incentive for exports”. The industry badly needs government support to accelerate exports," Rao said.
As per the report, India exported 11.95 million tonnes of rice in 2018/19 through March 31, down 7.2% from the previous 12 months, even though it had provided incentives for exports of non-basmati rice for four months of the year.
It is also predicted that lower prices from competitors could also be a contributing factor to a fall in exports.
India's 5% broken white rice was quoted at about $368-$372 per tonne compared with $350 for supplies in this week from Vietnam.
