India’s Basmati Rice Exports Expected to Stagnate in FY25, Indicates KRBL CFO
Published on: June 21, 2024.
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India’s Basmati Rice Exports Expected to Remain Steady in FY25
India’s basmati rice exports in the 2025 financial year are expected to remain at 5.2 million tonnes, according to Ashish Jain, CFO of KRBL Ltd, one of India’s leading rice exporters. This figure represents the same level as the previous year or a slight increase. Jain believes that achieving over 15 percent growth for two consecutive years is unlikely.
Jain mentioned that the demand for removing the Minimum Export Price (MEP) of $950 per tonne does not directly concern his company. However, he emphasized the need to re-evaluate the floor price to prevent Indian basmati from being outpriced by its closest competitor, Pakistan.
KRBL, known for its flagship brand ‘India Gate,’ primarily sells packaged basmati rice both domestically and in the export market. Out of the 9 million tonnes of basmati produced annually in India, around 2.5 million tonnes are sold domestically, with approximately 0.6 million tonnes of branded basmati rice. KRBL holds a 35 percent market share in the domestic branded basmati rice market.
The domestic demand for branded basmati rice has been growing, especially following the COVID-19 pandemic, as consumers have shifted from non-branded to branded packaged rice. KRBL reported an 18 percent growth in the domestic business in the last financial year.
Basmati rice prices have seen a decrease of 10-15 percent since January 2024 due to various factors, including higher production compared to the previous year and changes in policies or prices in importing countries.
The recent controversy over the Geographical Indication (GI) tagging of Indian basmati rice versus Pakistan in the European Union does not impact the branding of Indian basmati rice in the short term, according to Jain.
KRBL’s strategy includes expanding the distribution of branded basmati rice across the country, aiming to reach over one million outlets. Currently, they are present in less than 400,000 outlets out of a total of 700,000. The company also plans to make it easier for consumers to shift to packaged rice, expand basmati distribution, and launch new products.
While Jain did not provide specific revenue and profit guidance for FY25, he expressed optimism for double-digit year-on-year revenue growth based on continued growth in the domestic segment and increased exports.
Source: [Business Standard](https://www.business-standard.com)
