Evaluating export floor price for Basmati rice in India
Published on: October 15, 2023.
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Rice Export Pricing Reevaluation by India
The Indian government has recently begun reevaluating the minimum floor price established for basmati rice exports. This decision comes as a response to the ongoing efforts of maintaining control over overseas shipments.
Dramatic shifts in the global rice market have led to this renewed focus on export pricing. The Indian government, recognized as the world’s topmost rice exporter, stated on a recent Saturday that they will maintain a $1,200 per ton minimum export price (MEP) on basmati rice shipments. This price floor was originally introduced in August as a mechanism to stabilize local prices.
The announcement from Saturday has sparked concern among rice exporters, who foresee a potential decrease in shipments due to the government-mandated MEP.
Dwindling Prices and Export Challenges
The government issued a statement on Sunday acknowledging the prevalent downward price trend. This trend can be attributed to the influx of new rice crop arrivals in the market. Furthermore, it was noted that the country’s Consumer Affairs Minister has been in discussions with rice suppliers, who expressed that the floor price was negatively impacting exports.
As a result of these consultations, the review of the floor price is now “under active consideration of the government,” according to the official statement. The primary objective of enforcing the MEP is to ensure non-basmati rice isn’t being exported under the guise of basmati.
In an attempt to further ensure this, India had previously banned exports of non-basmati white rice in July. This was soon followed by the imposition of a 20% duty on parboiled rice exports.
The ongoing trends in rice business have led to a renewed focus on export pricing by authorities. The impact of these decisions on the pakistan rice prices and the broader international rice trade will be crucial to watch in the coming months.
