Indian rice exports gain momentum as US tariff cut to 18% improves demand and pricing power

India's rice exporters say a tariff cut by Washington will strengthen the sector's position in the United States market. The basic duty on Indian rice imports falls to 18 per cent from 25 per cent, which exporters expect will lift demand and improve margins.

The Indian Rice Exporters Federation (IREF) described the decision as timely because India is heading for record rice production. Strong domestic supply is expected to support higher shipments, and exporters see better pricing power once the lower tariff structure becomes effective.

IREF said India is on track to produce 149 million tonnes of rice in the 2025-26 crop year, from July to June. The federation highlighted firm domestic fundamentals, with adequate stocks and steady procurement, which support stable export availability despite duty changes abroad.

"Indian agri products continue to hold an indispensable position in global supply chains, and recent shipment patterns suggest clear demand resilience even under sharply higher duties," the federation said in a statement. IREF said this pattern indicates that importers still rely on Indian rice across key markets.

IREF National President Prem Garg said the sector is watching discussions on a waiver of additional penalties linked to India's purchases of Russian oil. "If confirmed, this would effectively reduce India's tariff burden from the current elevated level to 18 per cent, restoring parity with key competing origins such as Thailand and Pakistan, where competitor nations are currently tariffed at around 19 per cent," Garg said.

India's rice sales to the United States have expanded despite earlier duty increases, which rose from 10 per cent to 50 per cent. Exporters say this trend shows US buyers still view Indian rice as necessary for both retail consumers and food industry demand.

Trade data for the current 2025-26 fiscal year show continuing flows. Between April and November, India shipped 1,99,0558 tonnes of basmati rice and 40,960 tonnes of non-basmati rice to the United States, covering both premium and mass-market segments.

The previous fiscal year, 2024-25, also recorded solid volumes. India exported 2,74,213 tonnes of basmati rice and 61,341 tonnes of non-basmati rice to the United States. Exporters say these numbers underline the importance of the US as a stable destination for Indian shipments.

Fiscal year	Period	Basmati exports to US (tonnes)	Non-basmati exports to US (tonnes)
2025-26	April-November	1,99,0558	40,960
2024-25	Full year	2,74,213	61,341

Akshay Kumar, Head of Bulk Exports at KRBL Ltd, said the bilateral move is important for the basmati segment. "The reduction in reciprocal tariffs... is expected to ease export-related cost pressures and provide much-needed support to pricing competitiveness," Kumar said, adding that exporters can plan contracts with more clarity.

IREF noted that a tariff reset should improve landed prices in the United States for both basmati and non-basmati consignments. Better price parity could help India defend existing market share and compete with other origins that face similar, or slightly higher, duty levels.

The federation also commented on trade with Iran, another major buyer of Indian rice. Based on current information, IREF said it does not expect disruption to exports to Iran and sees continuity in shipment flows, while monitoring any policy or payment changes.

IREF Vice President Dev Garg said the federation will keep working with exporters, importers and authorities to handle any new procedures under the changed US tariff regime. The aim is to maintain predictable, rules-based trade and support stable volumes of India rice exports in global markets.