Basmati exporters reap rich dividends

Vijay C Roy

Tribune News Service

Chandigarh, November 1

Thanks to high basmati prices in the overseas market, exporters have registered a better realisation in the first six months of the current fiscal as compared to the previous year. 

While the export of basmati has risen marginally by 3% during the period, the realisation was 26% more per tonne in dollar terms in the current year. 

As per the Agricultural and Processed Food Products Export Development Authority  (APEDA) data, basmati exports during April-September (2017-18) was 21.32 lakh tonne as compared to 20.67 lakh tonne during the corresponding period previous year.

Further, in the current fiscal, the per-tonne realisation was $997 as compared to $789 in the corresponding period last year.

The total export value during the period was $2,126 million (Rs 13,690 crore) in 2017-18 as compared to $1,631 (Rs 10,923 crore).

Gurnam Arora, Joint MD, Kohinoor Foods, said, “Basmati exports have been encouraging because of demand from Iran in the first four months of the current fiscal. As far as realisation is concerned, it was due to high price of the commodity in the domestic market and better price in the overseas market.”

On being asked about the outlook for the current year, he said, “It is very difficult to predict at this moment as Iran has again discontinued the import of basmati rice from India. So, resumption of import by Iran will decide the fate of exporters and volume.” He, however, said Iran might resume the import by this month. “

Rating agency, ICRA expects the demand concerns in the form of Iran import ban and sluggishness in other countries would be overcome and export volumes in FY2018 to be around 4.1 million MT i.e 4% higher than FY2017. It also added that higher paddy prices in the last procurement season and current procurement season are expected to push up the average realisations in FY2018.

Arora said basmati production this year is down by 7-8% and total production would be anywhere between 90 and 95 lakh tonne. In the current season, there has been rainfall deficit in the key basmati producing states of Uttar Pradesh and Haryana. These factors can translate into lower paddy production in the current crop season, and thus the paddy prices are likely to open firm in the upcoming procurement season.