red sea crisis jeopardizes India’s basmati rice exports, warns commerce minister Piyush Goyal
Published on: December 30, 2023.
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Delhi, Dec 29 (KNN) – The current situation in the Red Sea region has raised concerns about its potential impact on India’s rice exports, according to Union Commerce Minister Piyush Goyal. However, more clarity will emerge in the coming month, as per a report in Mint.
India is a leading exporter of basmati rice, with an annual dispatch of over 4 million tonnes. Despite existing contracts, India aims to export an additional 500,000 tonnes of the new season’s basmati rice to Europe and the Middle East.
Disruptions in trade routes within the Red Sea region have posed challenges for basmati rice exports. These disruptions have resulted in increased logistics costs, as longer routes have to be taken by logistics companies to reach Europe and the Middle East.
The root cause of this crisis can be traced back to Yemen’s Houthi group, which has initiated drone and missile attacks on commercial vessels in the southern part of the Red Sea – a significant region for basmati rice exports to the Middle East.
Addressing the situation, the Union Minister stated, “The disruptions in the Red Sea are undeniable. While we haven’t seen immediate repercussions, a clearer picture will emerge next month with the release of the latest trade data.” He further mentioned at an event introducing the e-commerce exports handbook for MSMEs, “The rice export sector appears to be the most impacted, and we await the December trade figures for more insights.”
It is important to note that India halted non-basmati white rice exports in June to stabilize domestic rice prices. In August, a floor price of USD 1,200 per tonne was established for basmati exports, which was later revised to USD 950 per tonne in October.
According to the commerce ministry, rice exports decreased from USD 6.98 billion in the previous year to USD 6.45 billion from April to November 2023(Source).
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Source: [Source](https://menafn.com)
