Indian shipments of non-basmati rice in the current financial year are likely to remain at last year’s levels, mainly due to its competitive pricing and superior quality against major exporters such as Thailand and Vietnam.
However, lack of clear signals from Nigeria, one of the large buyers of Indian par-boiled rice could dent the prospects, exporters said.
Thai prices up
According to data provided by the All India Rice Exporters Association (AIREA), the country exported 11.65 million tonnes (mt) of rice in 2014-15 of which non-basmati varieties accounted for 7.87 mt.
Thailand exported around 11 mt over the same period but has a $10/tonne premium over Indian varieties in the 25 per cent broken rice and par-boiled rice segments, and were $40 more expensive in 100 per cent broken rice segment according to quotations earlier this week.
“Increased prices in Thailand have an impact on non-basmati rice. We touched 7.8 mt last year and should be at the same level in 2015-16 as well,” said a senior Government official.
Experts stated that overseas sales could increase, particularly with decreasing domestic prices and a depreciating rupee making exports cheaper in dollar terms against a strong Thai baht.
Nigerian market
Further, with China importing the bulk of Thai rice, India’s traditional non-basmati markets in Africa are likely to benefit domestic exporters. Nigeria, Senegal, South Africa, Liberia and Benin, are African nations that purchased the largest share of Indian non-basmati rice.
“Despite a new government in place, Nigeria is yet to spell out its policy on rice purchases. If Nigeria resumes imports from India, our exports will reach 7 mt, or else they will be lower at around 5.5 mt,” said BV Krishna Rao, Managing Director of Pattabhi Agro Foods Ltd, a large exporter.
Indian rice shipments to the violence-hit Nigeria had slowed down since December last year amidst fall in crude price and a weak currency.
“The rice inventory in Nigeria is low and shipments could pick up if there is clarity on the policy,” Rao added. India accounts for close to half of the 2.5 m t of parboiled rice that Nigeria imports.
“With the problems in Thailand – which competes with Indian non-basmati varieties in Africa – exporters here should do better in the upcoming year. Around 9-9.5 mt will likely be exported,” said Tejinder Narang, a grains trade analyst.
“Thailand also serves the Chinese market where demand pushes their prices up. As a result, the focus towards Africa gets deleted,” he added, stating that China granting access to Indian exports of non-basmati was politically reliant.
Sluggish activities
The industry expects rice output to be 2-3 mt more in 2015-16 than the 102.54 mt registered last year according to Government data. Non-basmati varieties are likely to make up 95 mt of the output.
Meanwhile, the shipments have turned sluggish as the prevailing heat wave in Andhra Pradesh over the past few days has hampered the loading operations at Kakinada, the major port for non-basmati rice exports.
“Loading operation is being carried out only in the night at the anchorage port due to the prevailing heat wave,” Rao said adding that the disruption was temporary.
Source : The Hindu Businessline