Global Rice News

The government has made a decision to lower the minimum export price (MEP) for basmati rice shipments from $1,200/tonne to $950/tonne, according to a senior official. The Agricultural and Processed Food Products Development Authority (APEDA) will issue a formal notification allowing exporters to register for shipments above the new threshold soon.

The Ministry of Commerce and Industry conveyed the decision on reducing the MEP to exporters during a meeting held on Monday. This reduction in MEP is expected to increase export realizations and boost farmers’ income, according to Vijay Setia, a former president of the All Indian Rice Exporters Association (AIREA) and a rice exporter based in Karnal.

In August, a temporary MEP of $1,200/tonne was imposed on basmati rice shipments until October 15 to restrict the illegal shipment of white non-basmati rice disguised as premium basmati rice. The temporary MEP was recently extended until further notice, which led exporters to halt the procurement of basmati paddy from farmers due to concerns about a slowdown in exports.

The commerce ministry had received credible field reports regarding misclassification and illegal export of non-basmati white rice, which was banned from July 20, 2023. This prompted the setting up of a committee by APEDA in collaboration with the agriculture ministry to examine the large price variations in the contract price of exported basmati rice in August.

The committee’s report recommended a substantial reduction in MEP to avoid hampering exports. Basmati rice, which is Geographical Indication (GI) tagged, is grown in over 70 districts in Punjab, Haryana, western Uttar Pradesh, Jammu & Kashmir, and Uttarakhand. It is known for its aromatic and long-grain qualities, commanding a premium in the global market.

India holds a share of approximately 75%-80% in the global aromatic rice market, while Pakistan accounts for around 20% of basmati rice exports.

Source