Rice exports slump by over 60%

Rice exports slump by over 60%

NEW DELHI, MAR 17: The country's rice exports have shown a decline of over 60 per cent to 1.7 million tonnes so far in the current financial year compared to 4.5 million tonnes shipped during the same period last year.

"Increase in procurement cost affects our rice exports and rising imports have also been negatively impacting the shipments," Adalakka said on the sidelines of the South Asian rice conference here.

He said the global demand for rice had slumped by four million tonnes as against last year's historic demand of 27.3 million tonnes. Adalakha said the international rice prices were currently about 25 to 30 per cent lower than the Indian prices, enabling other rice exporting nations like Thailand to undercut India in the international market.

Thailand rice is quoted $ 20 lower per tonne compared to Indian rice, Abhijit Sen, chairman, Commission for Agricultural Cost and Prices said.

Major exporters of rice are Thailand, Vietnam, the US, Pakistan and China. Adalakha said the increase in minimum support price announced by government for 1999-2000 rice crop had a telling impact on the price competitiveness of Indian rice in the international market.

A commerce ministry official said the fall in rice exports was also on account of better production in neighbouring Bangladesh, which had bought about 20 lakh tonnes of rice from India in 1998-99.

Adalakha said certain instances of export of poor quality rice had also tarnished India's image in countries like Indonesia. India has harvested a bumper rice crop during 1999-2000 estimated at around 84 million tonnes and the surplus grains procured by government agencies are being sold through the public distribution system.

The annual average domestic rice production growth was at about 1.7 per cent which almost matching with the population growth.

WHEAT EXPORTS: The Government's decision to raise the minimum support price for wheat will prevent any exports, industry officials said on Friday.

"It looks like the government's priority is not exports. Its first and foremost aim is to help the farmers," Mulraj Tanna, director of leading foodgrains exporter Jamnadas Madhavji, said. India on Thursday raised the minimum support price (MSP) of wheat to Rs 575 per quintal (100 kg) from Rs 550. The MSP is the level at which government buys from farmers.

"Our domestic prices are already high. Therefore, our export options are limited. Now, raising the price further will completely close the possibility of exports," Tanna said. India in January struck its first wheat export deal in four years when it signed a contract to ship 50,000 tonnes of wheat to Nepal.

The government had been talking to Indonesia and Middle East buyers to explore the possibility of exports. New Delhi recently received wheat export enquiries from Iraq, Russia and Mauritius. Indian trade officials have urged the government to export wheat even at "throw away prices" because it is saddled with excess stocks.

"Our wheat is rotting in godowns," said Prem Garg, managing director of Shivnathrai Harnarayanan, a leading foodgrain exporter. "The government should have cleared off some of its stocks before raising the minimum support prices."

The government has also raised the minimum support price for rapeseed to Rs 1,100 per quintal from Rs 1,000.

Trade officials said this would encourage farmers to grow more oilseeds, which would help meet the domestic shortfall and avoid edible oil imports. "Oilseeds farmers are in desperate need of some encouragement. We just can't go on importing edible oil and leave oilseeds farmers to suffer," said an official at a commodity trading firm.