How India's Non-Basmati White Rice Export Ban Could Be A Big Blow To Global Markets

Indian on Thursday announced ban on exports of non-basmati white rice in order to enhance domestic supply and keep retail prices under check during the upcoming festival season. However, the move is likely to impact the global rice market hard as India accounts for approximately 40% of global rice exports and is among the most competitively priced sources of Asian rice, according to reports.

There would be no change in export policy of par-boiled non-basmati rice and basmati rice, which forms the bulk of exports, the food ministry stated in a statement, according to a PTI report.

"Export policy of non-basmati white rice (semi-milled or wholly milled rice, whether or not polished or glazed)...is amended from free to prohibited," the directorate general of foreign trade (DGFT) said in a notification.

Export policy of Non-Basmati White Rice amended to ensure adequate domestic availability at reasonable prices," the ministry said, adding, the move is aimed to ensure lower prices and adequate availability in the upcoming festival season, stated the PTI report.

The total exports of non-basmati white rice from India was USD 4.2 million in 2022-23 as against USD 2.62 million in the preceding year. Major destinations of India's non-basmati white rice exports include Thailand, Italy, Spain, Sri Lanka and the USA.

In 2022, India accounted for 39% of global rice exports and the figures soared to 41% by June 2023, as per the data released by the US Department of Agriculture.
Meanwhile, non-basmati white rice constitutes about 25% of total rice exported from the country and the recent ban could hit global markets hard.

The reason for the export ban, while not explicitly mentioned, is likely the rise in the price of rice - an average of Rs 40.9 per kg as of 19 July, 11.3 percent higher than what it was a year ago, according to data from the Department of Consumer Affairs.

According to data obtained from government's Agricultural and Processed Food Products Export Development Authority (APEDA), India exported approximately 22.3 million metric tonnes (MT) of rice in 2022-23. Of this, 57% constituted non-Basmati rice.

Earlier last year in September 2023, India banned export of broken rice and levied a 20% tax on the export of several grains in an effort to bring down soaring prices.