India basmati exports touch record high in FY19

“The exporters are upbeat over growth in exports and they hope to maintain the same level in the current fiscal. The inventories with exporters are 10-15% less this year as compared to previous fiscal,” said Kohinoor Foods’ joint MD Gurnam Arora. 

The exports witnessed volume-wise growth despite challenges such as the pesticide residue issue leading to a fall in shipments to the European Union, Saudi Arabia mulling adoption of stringent pesticide rules, and initial uncertainty due to the imposition of trade sanctions on Iran by the US.

In rupee terms, the export value grew by 22% to touch Rs 32,806 crore against Rs 26,871 crore in 2017-18. In dollar terms, the growth was to the tune of 13%. The growth in rupee terms was higher than dollar terms mainly because of weaker rupee.

“The growth in exports and higher realisation to farmers in the last fiscal could translate into more area under basmati in the 2019-20 season. We believe there will be an increase in area under cultivation in the basmati belts of Punjab, Haryana and Uttar Pradesh,” said All India Rice Exporters Association president Vijay Setia.

In the last fiscal, basmati production dropped by around 5%, as the farmers shifted to non-basmati due to a considerable increase in its minimum support price and loss of the standing crop due to untimely rain in some of the key basmati-growing states.

Besides Punjab and Haryana, major basmati-growing states are UP (western), Uttarakhand, J&K, HP and Delhi, which contribute 25-30%.

While the shipments of basmati gained, the exports of non-basmati nosedived. In 2018-19, 75.34 lakh tonnes of non-basmati were exported to different countries as compared to 88.18 lakh tonnes during the corresponding period previous year.

Exports were down by 17.5% in dollar value terms and 11% in rupee terms during the period over the corresponding period last year.

According to the exporters, due to significant increase in minimum support price of paddy, the Indian rice has been un-competitive in global exports despite weak rupee.