Centre retains basmati minimum export price, Punjab businessmen cry foul

Chandigarh, October 14

The Government of India’s decision to retain the Minimum Export Price (MEP) Control order on basmati exports at $1,200 per tonne has sent shock waves among basmati growers and exporters in Punjab, which contributes to 35 per cent of basmati exports.

Reacting to the orders of extension of MEP of $1,200 per tonne beyond October 15, the prices of the basmati have started to slip.

Inquiries made by The Tribune in many mandis and from basmati growers has revealed that since yesterday, the prices of basmati have started sliding down, falling by almost Rs 400 to Rs 600 per quintal to Rs 3,200 to Rs 2,900 per quintal as exporters, in anticipation of the government extending the MEP of $1,200, have stopped buying basmati paddy.

Kuljit Singh, a basmati grower from Malawali village of Amritsar, told The Tribune that he had sold his PUSA 1509 basmati paddy last week at Rs 3,600 per quintal. “Today, this variety got just Rs 3,200 per quintal. I am yet to harvest my PUSA 1847 variety of basmati, but I am distressed as this variety is now getting just Rs 2,600-Rs 2,800 per quintal,” he said.

Till earlier this week, basmati was selling at an average price of Rs 3,600- Rs 3,800 per quintal and had even been bought at a peak price of Rs 5,005 per quintal in Bathinda. The prices remained high only on the economic sentiment created of slashing of MEP to $850 per tonne after Union Commerce Minister Piyush Goel had earlier indicated the same to rice exporters.

However, the Ministry of Consumer Affairs, Food and Public Distribution, in its office memorandum issued today, has not reduced the MEP. Rather, it has extended the MEP of $1,200 till further orders. This will be the death knell for basmati exports from the region, rued Vijay Setia, former president of All-India Rice Exporters Association. “Rice exporters got no orders for exports at the Istanbul Food Fair — WorldFood — last month because of the high MEP. As a result, they will not buy any basmati and farmers will have to go in for distress sale,” he rued.

Arvinder Pal Singh, another rice exporter, told The Tribune that at the Anuga Food Show earlier this week in Cologne, Germany, some rice exporters did get orders for export in anticipation of government lowering the MEP. “But now, these export orders will be cancelled. It is advantage Pakistan as they are getting export orders at $900 per tonne,” he said.

Prices fall

• Since Friday, the prices of basmati have started sliding down, falling by almost Rs 400 to Rs 600 per quintal to Rs 3,200 to Rs 2,900 per quintal as exporters, in anticipation of the government extending the MEP of $1,200, have stopped buying basmati paddy
• Till earlier this week, basmati was selling at an average price of Rs 3,600-Rs 3,800 per quintal and had even been bought at a peak price of Rs 5,005 per quintal in Bathinda