UAE Consumers to Benefit from Lower Prices as India Allows White Rice Exports – Will Wheat Follow?
Published on: November 9, 2023.
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The UAE is expected to be added to the list of countries where India’s white rice exports can be done under a new arrangement. This development could lead to price benefits of 10-27% for consumers in the UAE, according to senior trade and retail industry sources. The National Cooperative for Exports Ltd. (NCEL) has been created as a single point of contact for all rice exports from India, aiming to eliminate middlemen taking commissions from rice farmers. India has historically been the largest exporter of rice, including basmati, to the UAE. However, restrictions had been imposed on these shipments due to concerns about domestic market prices. With the easing of these concerns, it is expected that the UAE will soon be allowed to import rice through NCEL. This new system promises smoother and more transparent ordering and delivery, without the involvement of middlemen, which would lead to a drop in retail prices of white rice in the UAE. The NCEL program has already started this month with an initial list of approved countries including Malaysia and the Philippines. Moreover, the basmati rice shipments from India to the UAE are running smoothly again after India imposed a price ceiling on these exports. Only basmati priced at $1,200 per metric tonne is now allowed to be exported. This change allows lower-priced variants of basmati rice to remain available in the Indian market.
Source: Gulf News
UAE Could Soon Import White Rice from India Under New Arrangement
The UAE may soon be added to the list of countries where India’s white rice exports can be done under a new arrangement, which could provide immediate price benefits to UAE consumers, according to trade and industry sources. The new arrangement involves the “National Cooperative for Exports Ltd.” (NCEL), an entity created to facilitate exports of white rice and eliminate the involvement of middlemen. India, being the largest exporter of rice to the UAE, has previously restricted these shipments due to concerns about domestic market prices. Now, with the potential inclusion of the UAE in the list of nations allowed to import rice through NCEL, traders in the UAE will need to register with NCEL and place their orders, resulting in smoother and more transparent ordering and delivery processes. This change is expected to lead to a drop in retail prices of white rice in the UAE.
Positive Impact on UAE Consumers
Dr. Dhananjay Datar, Chairman and Managing Director of Adil Group, one of the major players in the UAE food retail sector, believes that the new rice export rules by India will have a positive impact on UAE consumers. The removal of middlemen from the procurement process will eliminate hidden costs, leading to lower retail prices of white rice in the UAE.
Eliminating Middlemen
Under the previous system, UAE rice importers would place orders directly with Indian counterparts, resulting in limited income for Indian farmers due to middlemen’s commissions. However, with the introduction of NCEL, all importers, whether in the UAE or any other country, will be required to source rice through this cooperative. This change will create a level playing field for importers and ensure fairer income distribution for farmers.
Steady Supplies and Approval of Countries
Supplies of Indian rice in the UAE, including basmati rice, have been steady so far, according to UAE food traders and supermarket sources. The shift to the NCEL program began this month, with Malaysia and the Philippines among the initial list of approved countries. This development is likely to further enhance the availability and consistency of Indian rice in the UAE market.
Basmati Rice Price Ceiling
India has recently set a price ceiling for basmati rice exports, allowing only rice priced at $1,200 per metric tonne to be shipped out. This decision ensures that lower-priced variants of basmati rice remain available in the Indian market while maintaining a steady supply of premium basmati rice to export destinations, including the UAE.
Overall, the new rice export rules by India are expected to have a positive impact on the UAE market, benefiting both consumers and farmers. The removal of middlemen and the introduction of NCEL will lead to transparent and efficient trade processes, resulting in lower retail prices of white rice in the UAE.
Source: Gulf News
