India asks European Union to allow duty free exports of all basmati rice varieties

  • In a move that is expected to give boost to rice exports, India has approached the European Union (EU) and the United Kingdom (UK) for allowing duty-free exports of all the 29 varieties of basmati rice notified by the agriculture ministry.

    India,  European Union, basmati rice varieties , Gulf countries, United Arab Emirates, Saudi Arabia,AIREA, rice exports, Uttar Pradesh , haryana, basmati rice exports
    Trades sources told FE that a zero rate of import duty is granted to eight varieties of husked basmati rice, including 370, 386, 217, Ranbir, Pusa basmati and Super.
     
    In a move that is expected to give boost to rice exports, India has approached the European Union (EU) and the United Kingdom (UK) for allowing duty-free exports of all the 29 varieties of basmati rice notified by the agriculture ministry. At present, under a code of practice and regulations signed in 2004, only eight varieties of basmati rice are allowed duty-free exports from India to EU and UK while those varieties notified afterwards, especially Pusa 1121 (2008) and Pusa 1509 (2013), which constitute at least 70% of around 4 million tonne of aromatic rice exports annually, are subject to a higher level of import duties. Trades sources told FE that a zero rate of import duty is granted to eight varieties of husked basmati rice, including 370, 386, 217, Ranbir, Pusa basmati and Super. While only 10% of India’s total basmati rice production is exported to EU including UK, the realisation from shipments is much higher than the bulk of basmati rice exports to Gulf countries such as Iran, Saudi Arabia, United Arab Emirates, Iraq and Kuwait. “Currently, exports of basmati rice varieties which were notified after 2004 attract a duty of €165 per tonne, which makes it costlier against other rice,” an exporter said. India being the top rice exporters for last many years, shipped 3.5 lakh tonne of basmati rice to EU valued at Rs 1,744 crore in 2016-17. Overall basmati rice export from India was Rs 21,605 crore for FY17. “There is ample scope of increasing shipment to EU and UK as code of practices and regulations signed more than a decade back needs to be revised,” an official said. He also said that they have received positive feedback from EU and UK authorities. Out of the total annual value of basmati rice exports, five countries – Saudi Arabia, Iran, United Arab Emirates, Iraq and Kuwait — have share of more than 68%. “EU and UK allowing more varieties of basmati under import duty free regime would boost rice exports prospects,” an official said. This follows EU’s recent decision to impose a stringent maximum residue limit (MRL) for Tricyclazole, a fungicide used by farmers against a disease which impacts basmati rice crop from December 31, 2017. The exporters in the country have launched an extensive campaign to educate the farmers in key growing states of Punjab, Haryana and western Uttar Pradesh on the judicious use of pesticide. “Many a times rice exports consignments were rejected because of detection of pesticides residues and our focus would be to educate the farmers against use of excessive pesticides which would lead to higher price realisation,” Vijay Setia, president, All India Rice Exporters Association (AIREA) had said.
  • Punjab’s border belt loses basmati aroma as area under sowing falls by 90% in 5 years

  • Low productivity of Basmati-386, for long the flavour of Amritsar, Gurdaspur and Tarn Taran districts, reduces the farmer’s interest in it; newer varieties are more productive but lack the distinct touch.

    basmati rice
    Daily-wagers working in a field near Verka village on the outskirts of Amritsar.(HT File Photo)
    Pure, traditional aromatic basmati, once the main export of the three border districts of Amritsar, Gurdaspur and Tarn Taran, is now on the verge of extinction. Basmati-386 that once brought fame to the region for its aroma and the length of its grain, is now grown on only 10% of the area it was grown just five years ago, Punjab Agricultural University, Ludhiana, has estimated. The reasons are many. These include the government’s failure to put a favorable export system in place with the main reason being the inadequate returns to the farmer. Falling yields of the variety with newer more productive varieties being discovered have added to the farmer turning away from sowing the variety. ‘Economics just does not add up’ Gurjit Singh, a farmer from Chaguwan village that famous for this variety, says, “This variety yields 8-10 quintals per acre. This is lower than other basmati varieties — PUSA-1121, PUSA-1509, Punjab-4 and 5 — that yield 15 quintals per acre to 18 quintals per acre.” Satnam Singh, another progressive farmer from Kuhala village, said, “I sowed Basmati-386 on once acre and got only Rs 2,400 per quintal. I needed to earn Rs 5,500 per quintal to make ends meet. I sowed the variety only to make it alive.” He added that the variety was also sown a month later than normal paddy, delaying the sowing of the Rabi wheat. “This lowers the wheat yield by up to two quintals per acre. The government, however, in not serious on our concerns. Millers question quality of our produce on flimsy grounds,” he claimed. “Cultivation of Basmati-386 is no longer viable as the PAU and other agri-universities in the country have developed other look-alike varieties which give better yield,” said Ashok Arora, owner of Dawat Basmati Rice, a prominent rice exporter. An attempt to make a similar variety, Basmati-370, also did not work as the aroma could not be reproduced. Apart from the two villages of Chaguwan and Kuhala, the other villages famous for the variety are Brar, Khyala, Bullar, Chawinda. These villages fall in Chugawan, Harchha Chhina, Ajnala and Attari blocks, respectively. Tarn Taran’s Gaddiwind blocks and Gurdaspur’s Batala area also situated in this belt.
     
    Chief agriculture officer Dalbir Singh Chinna said they aimed to ensure that growers got good price for their produce of older varieties to ensure survival. Why has Basmati-386 withered away? •The main reason being the inadequate returns to the farmer •The government’s failure to put a favorable export system in place with •Falling yields of the variety •Newer more productive varieties have been discovered
  • Beyond basmati – on the revival of scented rices

  • Over 300 fragrant rice varieties are being rescued from obscurity and extinction by committed farmers

    “I saw this beautiful paddy, golden yellow, with a reddish awn swaying in the wind. It is that vision that attracted me to seek the seeds and grow it. Then I fell in love with the aroma and taste. Now I grow acres of it and convince others to fall in love with Mullan kazhama.” That is Rajesh, activist-turned-organic farmer describing how he fell in love with Mullan kazhama paddy. Paddy fields, the rice and the verdant paddy landscape are indisputably among the most beautiful sights on earth. Till a few years ago, we knew nothing about Mullan kazhama rice from Wayanad or any other scented rice variety except the ubiquitous Basmati.

    Unconventional variety

    Mullan kazhama is a rather unconventional scented or aromatic rice variety, neither long nor slender. Instead it is rather round with an amazing taste and aroma. Today it appears regularly at our lunch table. It is my spouse’s favourite food in illness and good health. It is delicious in payasam and a friend who made Malabar biriyani with it can’t stop raving. Its cultivation had dwindled to almost nothing but has now been revived by a handful of committed organic paddy farmers in Wayanad.
    Mullan kazhama is just one example. The Indian sub continent is a treasure trove of scented rices with every region having its own favourites. With my involvement with the Save Our Rice Campaign, I began to see beyond Basmati. It all began with Gandhasaale, which grows in Wayanad , Kerala, and some hilly regions in Karnataka. I came across the slender, beautiful Jeeraga Samba after we moved to Tamil Nadu. With a sublime scent, it is much favoured in the state and used extensively for making pulavs and other dishes during special occasions. I began hearing paeans about Gobinda Bhog from my colleagues in West Bengal, and tasted this small-grained fragrant rice from West Bengal only last year. Categorised as a Khaas Dhan or special grain, it has a delicate fragrance and is the chosen offering for Lord Krishna, thus its beautiful name. It is great for payesh, and used for Janmashtami offerings, pujas and festivals. An organic farmer friend in Pune introduced us to Ambe Mohar, a scented rice supposedly favoured by Chatrapati Shivaji. Tulaipanji from West Bengal, Kaala jeera from Odisha, Chinnor from Madhya Pradesh, Vishnu Bhog from Chhattisgarh, Badshah bhog of Eastern India, the aromatic black rices Chakhao amubi and Chakhao poireiton of Manipur... the roll call has only just begun.

    Committed and passionate

    The revival of these scented rices is happening due to a small number of committed, passionate farmers and campaigns/groups working on seed and diversity conservation. They have scrounged and found lost seeds, worked to build markets where none existed, and educated the unaware about these delicious rices.
     
    Eating and cooking these rices is far better when grown organically. The aroma is also dependant on certain factors: cool temperatures during and after flowering stage and use of farmyard manure, manual de-hulling among others. Complete enjoyment of these rices can be derived if one is around while the rice is being cooked. The aroma wafts around the house and is almost like an appetiser. Scented rices tend to be relatively expensive, as they are generally low-yielding. It is not only humans who are addicted to aromatic rices. Birds love them too. A farmer from Wayanad explained how the gandhasaale fields have to be protected as the birds swoop down to pluck the tender fragrant grains from the stalk. The flip side is our ignorance about this treasure trove and our singular pursuit of Basmati to the exclusion of the scores of local varieties. This has led to a sad situation where farmers in South India or Eastern India try desperately and at great financial risk to grow Basmati to garner consumers and markets. As consumers, it is only our conscious choice of selecting these local scented rice varieties that will motivate farmers to grow these instead of pursuing varieties unsuitable to the climate and soil. Rice facts Chattisgarh and Madhya Pradesh have over 350 varieties of fragrant rices, while Odisha has 50 documented varieties.
     
    Almost all scented rices were accessible only to the royalty and not to the common man in earlier times.
  • Rice basmati remains weak on low demand, adequate supply

  • Daily News & Analysis

    Sat, 10 Jun 2017-02:21pm , PTI
     

    Rice basmati prices drifted further lower by Rs 200 per quintal at the wholesale grains market today on fall in demand against ample stocks position.

    Bajra and maize also eased on reduced of consuming industries. Traders said easing demand from retailers and stockists against adequate stocks position mainly put pressure on rice basmati prices. In the national capital, rice basmati common and Pusa-1121 variety fell further by Rs 200 each to Rs 7,000- 7,100 and Rs 5,700-6,000 per quintal respectively. Non-basmati rice permal raw, wand, sela and IR-8 also slipped to Rs 2,225-2,250, Rs 2,275-2,300, Rs 2,500-2,600 and Rs 1,850-1,900 as compared to previous levels of Rs 2,250- 2,275,Rs 2,300-2,350, Rs 2,700-2,800 and Rs 1,875-2,000 per quintal respectively in line with rice basmati trend. Other bold grains like, bajra and maize too declined by Rs 20 and Rs 50 to Rs 1,330-1,340 and Rs 1,360-1,370 per quintal respectively. Following are today's quotations (in Rs per quintal): Wheat MP (desi) Rs 2,100-2,345, Wheat dara (for mills) Rs 1,755-1,760, Chakki atta (delivery) Rs 1,760-1,765, Atta Rajdhani (10 kg) Rs 255-290, Shakti Bhog (10 kg) Rs 255-290, Roller flour mill Rs 950-960 (50 kg), Maida Rs 960-970 (50 kg) and Sooji Rs 1,040-1,050 (50 kg). Basmati rice (Lal Quila) Rs 10,700, Shri Lal Mahal Rs 11,300, Super Basmati Rice Rs 9,800, Basmati common new Rs 7,000-7,100, Rice Pusa (1121) Rs 5,700-6,000, Permal raw Rs 2,225-2,250, Permal wand Rs 2,275-2,300, Sela Rs 2,500-2,600 and Rice IR-8 Rs 1,850-1,900, Bajra Rs 1,330-1,340, Jowar yellow Rs 1,550-1,600, white Rs 3,100-3,300, Maize Rs 1,360-1,370, Barley Rs 1,610-1,630. (This article has not been edited by DNA's editorial team and is auto-generated from an agency feed.)
     
  • Price cap on Indian rice supports Pakistan’s rice exports to Iran

  • At times when Pakistani exporters of textile made-ups are unhappy over the crisis being faced by them in international markets, rice exporters seem happy to avail the opportunity of improving exports to Iran, following restrictions by Iran on rice imports from India. As both India and Pakistan produce the same high quality of rice known as Basmati, the two countries usually compete for major rice consuming countries, especially Iran which is considered a major destination for the long-grained aromatic rice. According to sources, Indian exporters of Basmati rice are facing serious problems in Iran after Tehran put upper limits for import and consumer prices of the cereal. While India’s recent exports of the rice to the West Asian country cost the importer around $950 per tonne (landed price), the ceiling price imposed is $850 a tonne and the maximum consumer price set is $ 1.15 a kg. With the ceiling prices, it would not be economically viable for India to export rice to Iran. Iran consumes more than 3 million tonnes of rice annually and a third of this demand is met by imports. Indian exporters have feared that the crisis in Iranian market would indirectly benefit Pakistan because of its proximity to Iran, as transportation cost was higher for India’s exporters. Not only the ceiling issue but also the uncertainty overuse of currency for trade between Delhi and Tehran has impacted India’s basmati rice exports to Iran following hesitation over the use of the dollar after fresh sanctions levied by the United States on the republic. Indian Basmati exports to Iran had witnessed sharp jump as Delhi launched a rupee settlement mechanism from April 2012 with Iran to avoid sanctions from the US and EU. This situation, as exporters in Pakistan believe, has opened room for exporters here to meet the demand of the neighbouring country. The export of rice mainly Basmati to Iran is being witnessed during the past few months creating over 50 per cent jump in the domestic price of the commodity. “We are largely happy to see the boost in export after a long time crisis faced by the sector,” said an exporter from Punjab. “Not only the crisis in Iranian market but the hike in the domestic price of rice in India following low production has also caused a reduction in export to Middles Eastern countries creating an increased demand for Pakistani rice in the traditional markets,”  he added. According to the data of Pakistan Bureau of Statistics (PBS), the exports of basmati rice from the country during the month of March 2017, increased by 154.28 per cent compared to the exports of the corresponding month of last year. During the month of March, about 45,745 metric tonnes of basmati rice worth US$ 43.976 million were exported as compared to the exports of 17,412 metric tonnes valuing of US$ 17.294 million of the same month last year. It may be recalled that food group exports from the country during the month of March decreased by 10.20 per cent and it was stood at US$ 346.12 million as against the exports of US$385.313 million of the same month last year. In last 3 quarters (July-March) of current financial year food group exports decreased by 11.58 per cent and recorded at US$ 2.885 billion as against the exports of US$ 3.037 billion of the corresponding period last year.
  • Grains: Rice basmati prices firmed up at the wholesale grains markets

  • Rice basmati prices firmed up at the wholesale grains market during the week on increased buying by stockists following uptick in demand against tight supplies. Wheat also found fag-end buying support from flour mills and finished marginally higher. However, a few other bold grains slipped due to reduced offtake by consuming industries. Traders attributed the rise in rice basmati prices to increased buying by stockists on the back of pick up in demand against restricted supplies from producing regions. In the national capital, rice basmati common and Pusa- 1121 variety edged higher to Rs 7,400-7,500 and Rs 6,100-6,400 from previous levels of Rs 7,100-7,200 and Rs 5,800-6,400 per quintal, respectively. Wheat dara (for mills) also ended higher by Rs 10 and Rs 1,740-1,745 per quintal. Atta chakki delivery followed suit and enquired higher by a similar margin to Rs 1,745-1,750 per 90 kg. Sooji too inched up by Rs 10 to Rs 1,040-1,050 per 50 kg. On the other hand, other bold grains like, bajra and maize declined by Rs 10 each to Rs 1,350-1,360 and Rs 1,415- 1,425 per quintal, respectively. (MORE)
  • Rice basmati moves up on stockists’ buying

  • Rice basmati prices firmed up by Rs 200 per quintal at the wholesale grains market today on emergence of stockists buying following uptick in demand. However, bajra and maize weakened due to fall in demand from consuming industries.
     
    Traders attributed the rise in rice basmati to fresh buying by stockists following upsurge in demand. In the national capital, rice basmati common and Pusa- 1121 variety settled higher at Rs 7,300-7,400 and Rs 6,000 -6,400 from previous levels of Rs 7,100-7,200 and Rs 5,800- 6,400 per quintal, respectively. On the other hand, bajra and maize drifted lower by Rs 20 each to Rs 1,350-1,360 and Rs 1,415-1,425 per quintal respectively due to subdued demand from consuming industries. Following are today's quotations (in Rs per quintal): Wheat MP (desi) Rs 2,100-2,345, Wheat dara (for mills) Rs 1,730-1,735, Chakki atta (delivery) Rs 1,735-1,740, Atta Rajdhani (10 kg) Rs 240, Shakti Bhog (10 kg) Rs 240, Roller flour mill Rs 950-960 (50 kg), Maida Rs 960-970 (50 kg) and Sooji Rs 1,030-1,040 (50 kg). Basmati rice (Lal Quila) Rs 10,700, Shri Lal Mahal Rs 11,300, Super Basmati Rice Rs 9,800, Basmati common new Rs 7,300-7,400, Rice Pusa (1121) Rs 6,000-6,400, Permal raw Rs 2,250-2,275, Permal wand Rs 2,300-2,350, Sela Rs 2,700-2,800 and Rice IR-8 Rs 1,875-2,000, Bajra Rs 1,350-1,360, Jowar yellow Rs 1,600-1,650, white Rs 3,300-3,500, Maize Rs 1,415-1,425, Barley Rs 1,610-1,630.
  • Matco Foods to belisted in September

  • KARACHI: Matco Foods, Pakistan’s largest rice exporter, is going for listing in the stock market in September this year to raise funds for its new plant in Karachi. Faizan Ali Ghori, director, Matco Foods, in an interview with The News said that funds to be received through Initial Public Offering (IPO) of Matco Foods in September would be invested on a new plant in Karachi. Matco Foods has major stakes in Basmati rice. Being the largest Basmati exporter of Pakistan, it exports to around 65 countries. “Our brand ‘Falak’ is the largest selling Basmati brand from Pakistan,” he said. Matco processes around 100,000 tons of Basmati per year. It has also been financed by World Bank’s institute IFC. Ghori, who is also a member executive council of Rice Exporters Association of Pakistan (REAP), said Matco was also going in the business of other foods, as seller of imported biscuits, wafers, rice flour, gram flour, oil, pink salt, etc, since Pakistan has one of the highest consumption to GDP ratio in the world.   He said the company was investing in the new business of organic rice glucose and organic rice protein products, which would be used by other companies, mostly in their baby products. “Majority of glucose is extracted from corn, but in Europe and the US, corn syrup is being replaced with rice,” he said. “Since rice is not genetically modified, it is least likely to cause allergy.” Matco’s plant would have capacity of 10,000 tons per year of rice glucose and rice protein, and the plant would start operations this month at a preliminary investment of Rs350 million. Another plant of this type would be established at Port Qasim in the next phase, where a land of 10 acre has been purchased and further funds would be generated from the IPO. “In the next phase, we will develop dextrin (powdered) glucose,” Ghori said. Talking on Federal Budget 2017-18, he said overseas financing for warehousing would be beneficial for non-Basmati exporters, especially those who export to African countries, where Pakistan’s IRRI rice was mostly consumed as staple food. “People can establish their warehouses there and get financed,” he said. “We will have advantage in Kenya market with it.” This was a proposal of REAP, which was incorporated in the budget. Besides African countries, China is also a big market for IRRI. “Last year, Pakistan exported 0.5 million tons to China but this year it (China) is importing from Vietnam and other countries,” he said. Matco processes Basmati in all four types; unrefined brown rice, refined Basmati, parboil (sela) and steamed Basmati. “We are using latest technology and have imported machines from Japan and Germany,” Ghori said. He said alarmingly seed development was not here, so yield was too low. Hybrid seeds provided 90 to 100 maunds per acre in the world while our production was at a maximum level of 60 maunds. “No new variety of Basmati was developed after late 80s,” he said. “A famous Basmati variety 1,121 was developed in India and smuggled in Pakistan.” Matco exports around 80 percent of its production and sells 20 percent in the local market. However, it is planning 50 percent sales in the local market in the coming 5-6 years, as “People here are saving their time of rice cleaning and more people are going towards processed and cleaned rice,” he said. He suggested that Pakistan should focus on seed development, as plant scientists in India were doing, but regretted that the Rice Research Institute was not developing any seeds on commercial level. “Our yields are lowest per acre,” he said. “Mechanical transplantation should be here.” He said REAP has been suggesting the government to allow it to use Export Development Fund to use on farmers’ education and research. Matco is growing organic rice in Punjab while lands in Golarchi, Sindh is under conversion, as it takes three years to land for the conversion for organic plantation. “We have received USDA and EU organic certification,” he said. “Last year Matco exported 300 tons of organic rice.”
  • Jammu to be hub for export of quality basmati rice: SKUAST-J

  • Rising Kashmir News

    Jammu:  Experts on Tuesday said that Jammu will become a hub for export of quality basmati rice in India. This was said during a one-day workshop on ‘Quality improvement in production of Basmati rice for export’ at Chatha, wherein about 225 farmers from Basmati rice growing region of Jammu, Samba and Kathua districts participated and was attended by the national and state level experts of Basmati rice. According to a statement, the workshop was organized by Sher-e-Kashmir University of Agricultural Sciences and Technology (Jammu), in collaboration with Basmati Export Development Foundation (BEDF), APEDA, Government of India, organized one day workshop and focused on the production, marketing, utilization and export of Basmati rice in context of development of entrepreneurship. “A high level exchange of knowledge between the scientists, farmers and field functionaries to develop the road map for Basmati rice farming was taken up during the workshop, a spokesman said in the statemnet. During the programme, the spokesman said, the official website of Society for Integrated Development of Agriculture, Veterinary and Ecological Sciences (SIDAVES) was launched by Prof. P.K. Sharma, Vice Chancellor of SKUAST-J and the chief guest of the workshop. Prof. Pardeep Kumar Sharma congratulated the farmers for their enthusiastic participation in the workshop and appealed them to maintain the quality of their basmati produce to fetch a good price in the market and double the income of basmati growers. He advised the farmers to keep in touch with the scientists and experts for any kind of problems in their fields. He appealed to the basmati growers to be prepared to register themselves with the online portal to be launched shortly by the Government of India. He also congratulated Dr. Jag Paul Sharma, director Research and his team for the launch of the society SIDAVES for the benefit of mother earth and mankind. Dr. Jag Paul Sharma, Director Research of SKUAST-Jammu, gave a lecture on entrepreneurship in Basmati and its organic cultivation. He advised the farmers to adopt scientific advisories and regulations to obtain optimum yield and quality in basmati entrepreneurship in Jammu province. He emphasized for further improvement in basmati rice with increased grain length, high aroma, grain yield and resistance to diseases and insects and providing value addition to basmati rice varieties. Sharma stressed upon the use organic basmati seed for organic production of basmati rice, along with the use of bio-fertilizers and bio control agents. He advised for the development of farmer producers organizations (FPOs) of basmati growers in Jammu province. Dr. Ritesh Sharma, Principal Scientist (BEDF) interacted with the basmati growers of Jammu district and gave a lecture on strengths and challenges in export of Basmati rice and quality production techniques. He enlisted Ranbir Basmati and Basmati 370 of Jammu among the top 30 varieties of basmati rice and told that Pusa Basmati 1121 contains the longest grain length and constitutes 80 percent of the total basmati export. He discussed in detail about the problems, solutions, weaknesses and strengths of basmati growers of Jammu district and told that the pesticide residual effect is very less in Jammu Basmati as compared to other regions. Ravi Aggarwal, Chief Manager, Northern Region, Indian Potash Limited (IPL) appreciated the efforts of scientists of SKUAST-J in improvement of production technologies of basmati rice in Jammu province and requested the farmers for optimum use of fertilizers in their fields. IPL organized a quiz competition among the participating basmati rice growers wherein five winning farmers were facilitated with 50 kg bag of potash to each. Dr. S.K. Singh, Scientist of Organic Farming Research Center- Chatha, elaborated eco-friendly diseases and insect pest management of Basmati. Dr. R.K. Salgotra, Coordinator of School of Biotechnology presented welcome address, while, a formal vote of thanks was presented by Dr. R. K. Arora, Associate Director Extension and Incharge of all KVKs of SKUAST-Jammu.
  • Grains: The wholesale grains market remained weak

  • The wholesale grains market remained weak for the second straight week with prices of wheat and rice basmati sliding further on reduced offtake by flour mills and stockists against adequate stocks position. However, barley moved up on pick up in demand from consuming industries. Traders said reduced offtake by flour mills against sufficient stocks position on persistent supplies from producing regions put pressure on wheat prices. Muted demand weighed on rice basmati prices, they said. In the national capital, wheat dara (for mills) eased by Rs 5 to Rs 1,730-1,735 per quintal. Atta chakki delivery followed suit and traded lower by a similar margin to Rs 1,735-1,740 per 90 kg. In the rice section, rice basmati common and Pusa-1121 variety also dropped to Rs 7,100-7,200 and Rs 5,800-6,400 from previous levels of Rs 7,400-7,500 and Rs 6,000-6,800 per quintal. On the other hand, other bold grains, barley went up to Rs 1,600-1,620 from previous level of Rs 1,565-1,585 per quintal.(MORE) (This article has not been edited by DNA's editorial team and is auto-generated from an agency feed.)
  • Basmati export benefits from ban on DA, exporters seek similar move for non-basmati

  • CHANDIGARH: Basmati, premium rice, has brought back flavour in the export for the domestic companies who are hailing timely payments from overseas buyers after the Indian government banned documents against acceptance (DA) for the commodity in the current marketing season. The exporters are mulling to seek similar DA restriction for export of non-basmati from India in the ensuing marketing season. The practise of DA had tilted the basmati trade in favour of overseas buyers due to rise in defaults, delayed payments and price manipulations that adversely affected domestic companies. The DA allowed export of consignment without settlement of payments. Even though DA has been banned in the last year for export of basmati but the practise is still prevalent in case of export of non basmati from India. "The curb on DA in export of basmati has decreased defaults in the trade and also given control over prices to the domestic exporters," executive director, All India Rice Exporters Association (AIREA) Rajen Sudershan told ET. Sudershan said that the rice exporters lobby is contemplating to seek ban on DA in case of non-basmati from the Indian government. "The move will boost export and also benefit different stakeholders in the rice trade," he said. The rice exporters maintain that the ban on DA had brought benefits to domestic companies as well as farmers who received timely and higher remuneration this time compared to the previous marketing season. "The policy amendment on DA by government has given confidence to exporters who were exploited by buyers once consignments have been delivered," Vijay Sethia past president of AIREA said. Sethia said that the practise of DA allowed buyers to manipulate all companies who were forced to compromise on margins. This year the ban on DA has promoted transaction through Cash against documents and Letter of Credit. "It has lead to better rice realization to exporters and higher remunerations to farmers," Sethia said. The export of basmati this season stood around 3.99 million tonnes till March 2017 compared to 4.4-million tonnes in 2015-16. The Indian basmati export has been affected due to less basmati trade to Iran after the gulf nation introduced price regulation of $850 per tonne on basmati import.
  • Basmati exporters expect higher output on good monsoon forecast

  • No change seen in shipment volumes; basmati output in the country is roughly 6.6 million tonnes

    Branded basmati sales to touch 2.9 mt
    The forecast of a good monsoon and projected rise in basmati sowing is likely to mean more earnings for its exporters in the current season, though the volume of shipments is not expected to change.
     
    Of all production, basmati accounts for about 6.6 million tonnes (mt); last year's sowing was on 1.6 mn hectares.
     
    This year’s monsoon forecast and farmers' better realisation last year is projected to result in more sowing. That translates to a lower purchase price for processors and exporters. The volume of export is not expected to go up, due to difficult economic conditions in the key of the and European Union.
     
    In 2016-17, basmati export was about four mt, with almost 80 per cent to the countries, and Iraq. “Our projection is that export would remain at last year’s level; new have not been explored,” says Gurnam Arora, joint managing director, Kohinoor Foods, which send out 150,000 tonnes a year.
     
    table
    The domestic basmati is also expanding and likely to see close to five per cent growth this financial year.
     
    “China is a big and if we are able to and distribute our product properly, it would expand export volumes significantly,” Arora added.
     
    R Sundaresan, executive director, All India Rice Exporters Association, said Haryana and Punjab accounted for 40-45 per cent of total basmati production, followed by Uttar Pradesh at 10-15 per cent. In UP, sowing is likely to expand by almost 30 per cent, feels UP Rice Millers’ Association patron Sanjeev Agarwal.
     
  • Prices of wheat and rice basmati fell at the

  • Prices of wheat and rice basmati fell at the wholesale grains market during the week due to reduced off take by flour mills and stockists against ample stocks position. However, bajra and barley traded higher on pick-up in demand from consuming industries. Traders said reduced offtake by flour mills against sufficient stocks position on persistent supplies from producing regions put pressure on wheat prices. Muted demand against adequate stocks position weighed on rice basmati prices, they said. In the national capital, wheat (desi) and wheat dara(for mills) slipped to Rs 2,100-2,345 and Rs 1,735-1,740 from previous levels of Rs 2,125-2,370 and Rs 1,750-1,755 per quintal respectively. Atta chakki delivery followed suit and eased to Rs 1,740-1,745 against last close of Rs 1,755-1,760 per 90 kg. In the rice section, rice basmati common and Pusa-1121 variety also finished lower at Rs 7,400-7,500 and Rs 6,000-6,800 from previous week's levels of Rs 7,600-7,700 and Rs 6,200-7,000 per quintal, respectively. On the other hand, other bold grains like bajra and barley rose by Rs 20 and Rs 15 to Rs 1,370-1,380 and Rs 1,565 -1,585 per quintal respectively. (MORE) (This article has not been edited by DNA's editorial team and is auto-generated from an agency feed.)
  • Basmati Boom Has LT Foods Seeking Growth in Europe, Middle East

  • One of India’s biggest basmati rice processors is targeting Europe and the Middle East for expansion as it seeks to capitalize on surging demand for the aromatic grain after conquering the U.S. market. Shares of LT Foods Ltd. have more than doubled this year as the half-century old commodity trader increases focus on branded foods to exploit changing consumer desires in India and abroad. “We want to concentrate and increase sales of our branded products, especially in the U.S. and Europe, as we see huge potential there” and in the Middle East, Ashwani Arora, joint managing director, said on Monday in an interview in New Delhi. 
    The Mumbai-listed firm bought the Gold Seal Indus Valley and Rozana rice brands from Hindustan Unilever Ltd. last year to strengthen its presence in the Middle East. It purchased the 817 Elephant brand in July to further boost sales in markets like the U.S. and Canada, and is setting up a plant in Rotterdam to cater to Europe, Arora said. “We want to be recognized as a food company, not a commodity trader,” said Arora, whose family started the business as a grains trader in the 1950s and set up its first rice mill in 1978. "The trend is health plus convenience. We are following that trend and developing our whole product range based on the theme." Although it has captured more than 50 percent of the basmati rice market in the U.S., it’s share in the Middle East and European markets is nominal, according to the company, which also sells rice brands such as Daawat, Royal, and Hadeel. LT Foods and Japan’s Kameda Seika Co. set up a joint venture in November to manufacture and market rice-based snacks in India. The Indian firm also joined hands with Future Group in December to process and sell south Indian rice.

    Basmati Rice

    Basmati rice accounts for about 38 percent of total rice consumption in the Middle East, 4.4 percent in Europe, 1.3 percent in the U.S. and 1.2 percent in Asia, according to a company presentation. LT expects revenue will almost double to $1 billion by 2020 from an estimated 32 billion rupees ($500 million) in the year ended March 31, Arora said. Improvements in procurement, processing, sales and distribution should help lift operating profit as a percentage of revenue to 15 percent in the coming years from 12 percent, he said. Rising income in India has encouraged consumers to shift to modern convenience stores from mom-and-pop shops, boosting demand for branded rice and pulses. Branded products account for 26 percent of total basmati sales in the country, according to the company. LT Foods annually sells about 200,000 tons of branded basmati rice in India, capturing a market share of 20 percent, he said. Branded packaged rice accounts for about two-thirds of its sales, while trading and value added products such as organic cereals and brown rice make up the rest, Arora said.  The company, which competes with firms such as KRBL Ltd. and Kohinoor Foods Ltd., is aiming to increase its annual rice processing volumes to 500,000 tons in two years from 400,000 tons by outsourcing mills owned by others, Arora said. Ajay Thakur, an analyst with Anand Rathi Securities Pvt., said in a report in February that the company’s stock valuations were inexpensive and the rising share of its branded business, cost efficiency-led margin gains and better inventory management were expected to drive greater free cash flow and return ratios. He has a buy rating on the stock. “We don’t want to make a fresh capital expenditure and we will outsource because there are a lot of idle capacities that are available,” Arora said. “We are keen on spending money on branding and advertising our products. The focus is to invest in brands and markets.”
  • MoU inked to boost rice exports to Saudi

  • MoU inked to boost rice exports to Saudi
     
    KARACHI: Rice Exporters Association of Pakistan (REAP) and Jeddah Chamber of Commerce and Industry (JCCI) has signed a memorandum of understanding (MoU) for long-term institutional collaboration between the two trade bodies, a statement received here on Monday said. “Such visits are necessary to increase bilateral trade, commerce, and investment between both the countries and signing of this MoU would be a milestone towards achieving this objective,” Sheikh Mazen Mohammed Batterjee, vice chairman JCCI, told the signing ceremony held in Jeddah.  Batterjee also assured Pakistani rice exporters of Jeddah chamber’s full support in achieving this goal of common good.  Speaking on the occasion, Shah Jahan Malik, vice chairman REAP, said he was upbeat that after the signing of the agreement Pakistan would be able to increase its exports to the Saudi market. “The 14-member joint delegation of REAP and Pak-Saudi Joint Chamber of Commerce & Industry (PSJCCI) is visiting Saudi Arabia from 11-19 May, 2017, as part of trade promotion activities to increase export of rice to the Kingdom of Saudi Arabia (KSA),” the statement said.  It added that the delegation members visited the major super as well hypermarkets and held meetings with their top management. They also met with major Saudi rice importers of the western region, in one-on-one business networking session organised by the Consulate of Pakistan.  “After the meeting, the Pakistan consulate hosted a biryani dinner for potential Saudi buyers with an aim to promote Pakistani rice, which is equally famous for its long-grain, aroma, and taste across the world,” the press release said. Mian Mehmood, president PSJCCI, told the media that Saudi Arabia is our major trading partner in food sector and imports over $1 billion worth of rice every year. “Pakistani rice exporters should make the most of this opportunity to further increase the share of Pakistani rice in this market,” Mehmood said.   He added that the PSJCCI is playing a very vital role in promoting trade in all the sectors between the two brotherly countries.  Appreciating the initiative taken by the REAP, Shehryar Akbar Khan, Consul General of Pakistan, said the country was constantly striving to improve its technological-agricultural capacity to increase volume of its rice exports in the face of stiff competition from its competitors. 
  • Centre, basmati exporters looking at alternative fungicides to treat rice

  •  Isoprothiolane is good alternative to tricyclazole, but restricted in the US
     

    The Centre is working with basmati exporters to identify alternatives to tricyclazole — a fungicide used to treat rice — as the European Union seems inflexible in its decision to bring down the tolerance level for the chemical next year, effectively banning its use.

    “If alternatives are not found, India’s basmati exports to the region could get hit drastically as the levels of tricyclazole in Indian rice is mostly much higher than the default level of 0.001 ppm (parts per million) that the EU wants,” a government official told BusinessLine.

    The Agricultural and Processed Food Products Export Development Authority (APEDA), under the Department of Commerce, together with basmati rice-exporting companies, is looking at possible solutions to the problem, the official added.

    No issues with current cap The maximum residue limit (MRL) for tricyclazole, a fungicide used by rice-growing countries to protect the crop from a disease called ‘blast’, is at present fixed at 1 ppm by the European Union.

    Indian exporters do not have any problems staying within this limit, but once the default level of 0.001 ppm kicks in, much of the $3 billion of basmati exported to the EU from India could get affected.

    The industry and government are finding it difficult to zero in on other fungicides that could be used because of a peculiar problem, the official said. While the fungicide isoprothiolane (IPT) could be a good alternative to tricyclazole as it has similar properties and is allowed in the EU, it is difficult to advise farmers to switch to it as the chemical is restricted in the United States.

    So, in order to save the market in the EU, India would have to put at risk its market for basmati rice in the US, if it switches to IPT. The Indian Council for Agricultural Research (ICAR) is also working on varieties of rice that are resistant to the heat blast disease but it will take time to yield results.

    “Before we are able to have our own varieties of disease-free rice, we have to use our diplomatic skills to sort out the problem with the EU and also with the US if required,” the official said.

    India is continuing to talk to the EU hoping to convince it to change its mind about lowering the maximum residue limit for tricyclazole.

    “The EU does not seem too impressed by the problem Indian basmati exporters may face next year. India is talking to countries like Italy and Portugal, which do not support the EU initiative of raising the tolerance level, to strengthen its argument,” the official said.

    (This article was published on May 11, 2017)
  • Returns on rice: The making of India’s biggest basmati exporter

  • Anil Mittal's family business KRBL is reaping the benefits of its decision to penetrate the domestic market with new brands and varieties of basmati, while maintaining a strong export business

    mg_96111_krbl_280x210.jpgAnil K Mittal, chairman and MD, KRBL, says business was ingrained in him at a young age
    Image: Amit Verma What’s in a name? A rose by any other name would smell as sweet, William Shakespeare had insisted. However, Anil K Mittal, chairman and managing director of India’s top rice exporter KRBL—makers of the popular India Gate basmati rice among other brands—politely disagrees, at least as far as his company’s name is concerned. “I wish we had retained the full name, Khushi Ram & Behari Lal, instead of the abbreviation, as it speaks volumes about our legacy,” says Mittal. “After all, there’s a lot in the name.” The legacy that Mittal refers to spans a century. The company, headquartered in Noida, has come a long way since it was founded in 1889 in Lyallpur (present day Faisalabad in Pakistan) by Behari Lal—Mittal’s great grandfather—and his brother Khushi Ram. Back then, it had interests primarily in cotton-spinning mills; it was also involved in banking and textiles. Rice mills, now its mainstay, comprised just a miniscule part of the overall business then. Today, KRBL is the world’s largest rice miller and exporter with over 30 percent share of the domestic and 25 percent share of the branded basmati rice export market. It runs two plants—one in Dhuri, Punjab, and the other in Gautam Buddha Nagar in Uttar Pradesh—with a combined milling capacity of 195 MT per hour, according to Karvy Stock Broking. Apart from the flagship India Gate basmati rice, KRBL’s other basmati brands include Doon Basmati, Nur Jahan and Bemisal. While the company has mainly positioned itself as a basmati provider, in the non-basmati category its brands include Aarati. In addition, the company also produces value-added products such as bran oil and has an installed renewable energy capacity—comprising bio-mass, wind and solar—of about 134 MW.
    mg_96113_krbl1_280x210.jpg
    For the financial year ended March 31, 2016, KRBL reported a total income of Rs 3,594 crore and a net profit of Rs 334 crore. Experts say the figures are not surprising given the company’s brand strength, quality distribution, lower cost of raw material and higher price realisation. KRBL’s market capitalisation too has grown at a compounded annual growth rate (CAGR) of 86 percent over the last five years to touch Rs 9,699 crore on March 31, 2017. In the last one year alone, its shares have surged by 88 percent on BSE to touch Rs 430 on April 24, 2017. “I believe the major inflection point for KRBL was after FY12. The management prepared a road map to increase the exposure to basmati rice and the domestic market,” says Deven R Choksey, managing director, KR Choksey Investment Managers. “The company developed a lot in terms of its distribution channel. This has helped them improve their penetration in the domestic market. Besides, they have increased their presence across different international markets, which has also reduced vulnerability in financial performance,” he adds. For instance, Iran’s ban on rice imports between October 2014 and December 2015 only had limited impact on the financial growth of KRBL as it was largely offset by strong growth in other West Asian countries. “Going ahead, the lifting of Iran’s ban on [rice] imports along with Indian youth showing a preference for basmati could aid topline growth for industry players,” says Choksey. Business was ingrained in me at a very young age and I started working when I was all of 12, giving a helping hand to my father who had suffered a heart attack then,” the 65-year-old Mittal tells Forbes India. After witnessing success in the cotton trade in Pakistan, Mittal’s family had migrated to India in 1947 during Partition. “It was a few years before my birth. My family came back from Pakistan in a chartered flight and landed at Safdarjung airport in Delhi. Life changed for everyone and business had to begin from scratch,” Mittal says, recalling the stories narrated to him by his father. While they had three other properties in India, the family chose to set up its headquarters at Naya Bazar, Delhi’s famous grocery market, and began as trade agents. Scaling up, “from small to big”, is an easier transition than “falling from top to bottom”, says Mittal, pointing out that the hardships, then, are far more. His family, he remembers, in the early 1950s had made a refugee claim worth Rs 3 crore to the government for lost property. Of that, assets worth Rs 1 crore were sanctioned and those rejected were claims for properties registered in the name of the company. “We were told we would get money only for properties registered in our name,” says Mittal. With the money they got—which was to the tune of Rs 3.5 lakh—KRBL started a business of running oil mills and rice mills. Mittal officially joined the business in 1968. “Ours was a large family. I had many uncles who were a part of the business. I realised that if I had to make my mark I would have to do something innovative, even if that meant taking the same business forward.” Mittal then briefly worked at his maternal uncle’s flour mill in Uttar Pradesh. “Those were the days when I was trying to do things on my own and it was an enriching experience that changed my life. Flour mills were like money-churning machines. I garnered enough experience to start off on my own.” In the mid-1970s, Mittal bagged a tender to supply barley to the army. “That was the turning point in my life,” he says with a beaming smile, and “there wasn’t any looking back since”. From barley, the transition to a full-fledged rice business, he says, was not too cumbersome. “KRBL was already in the rice business, but that was with the whole family. I decided to redefine the business and focus primarily on rice, changing the company’s name to Anil Trading Company. But soon after its success, I changed the name back to Khushi Ram & Behari Lal.” It became KRBL in the late 1990s. The early years purely went into trading in rice. “We became suppliers to leading domestic exporters. And as fortune favours the brave, when India opened rice exports in 1978-79, life changed completely for us,” says Mittal, who kick-started the process to export the grain himself in the mid-1980s. “By then, we had already made a name for ourselves in the industry and also knew the key people. From supplying rice to big exporters, we decided to become exporters ourselves,” says Mittal. “The remarkable growth that the company has witnessed has to do with the management’s involvement in every aspect of the business right from seed development to modern farming,” says Jagannadham Thunuguntla, head of fundamental research, Karvy Stock Broking.
    mg_96115_krbl2_280x210.jpg
    On more than one occasion, KRBL has shown its prowess in identifying the right variety of rice that the market would accept. In the 1990s, when KRBL recognised Pusa No 1 as a variety of basmati, it was rejected by the entire industry. Today, it is one of the most popular basmati rice varieties in the world. Again, in the early 2000s, when KRBL introduced Pusa 1121 (the grains of which are slightly longer than Pusa basmati rice) to the market, it once again took the industry by surprise. This was a special basmati line developed by the Pusa Institute, Delhi, but the industry could not foresee its potential. “I decided to cultivate and multiply this variety [Pusa 1121] in our contract farming programme on a commercial basis,” says Mittal. KRBL’s own research and development team and scientists were involved in this project, and they were the first ones to bring Pusa 1121 into the market—export as well as domestic. “When Pusa 1121 was launched, it just swept the markets across the world. The entire industry was astounded with the sensational success of this variety,” recalls Mittal. According to company data, of the 12 million tonnes of basmati paddy currently being produced in India annually, Pusa 1121 accounts for about 6 million tonnes. Another decision that Mittal claims to have worked in favour of the company is the takeover of Oswal Agro Furane, a sick unit in Punjab, from the High Court of Punjab & Haryana in 2003. Today, it is the biggest rice plant in the world with a capacity of 140 MT per hour and can process about 1 million tonnes of paddy per year which is about 7 percent of the paddy cultivated in Punjab. The success of any business, Mittal knew, was not in the vision alone. A lot depends on execution too. “When I started doing business, I used to look up to large business houses. While it’s not fair to take names, it was my dream to grow into those kind of mighty and huge establishments one day,” says Mittal. “But over the years, I have also seen many reputed enterprises coming down drastically. The descents have been as quick as the ascents.”
    I entered this industry as a young man... facing formidable competitors. The beginning was very modest and the journey intimidating.
    While KRBL is run by Mittal, his brothers, and daughter Priyanka, he says he is focusing on a lean organisation which would be nimble enough to adapt to quick changes. After all, the basic strength of any setup comes from its people. Key departments such as human resources and marketing work in tandem to “choose the right people for the right positions, so that the right decisions are taken at the right time. And it is important that all the people are capable of thinking and acting in their individual capacity,” says Mittal. For any business to grow, an employee should be allowed to function like an entrepreneur in his sphere of activity, he adds. The intrepid Mittal has travelled a fair distance in his entrepreneurial journey, but “there is still a big gap between my dream and my [position] today,” says Mittal. “I entered this industry as a young man, and I saw myself facing formidable competitors. The beginning was very modest and the journey intimidating. But you cannot give up.”

    (This story appears in the 26 May, 2017 issue of Forbes India. You can buy our tablet version from Magzter.com. To visit our Archives, click here.)

  • Wheat, rice basmati slide on reduced offtake

  • New Delhi, May 2 () Weak conditions prevailed at the wholesale grains market today as prices of wheat and rice basmati drifted lower by up to Rs 300 per quintal due to reduced offtake by flour mills and stockists against ample stocks position. A few other bold grains also eased on lack of demand from consuming industries. Traders said reduced offtake by flour mills against sufficient stocks position due to increased supplies from producing belts mainly led to the decline in wheat prices. They said tepid demand kept pressure on rice basmati prices. In the national capital, wheat MP (desi) and wheat dara (for mills) fell by Rs 50 and Rs 40 to Rs 2,150-2,450 and Rs 1,695-1,700 per quintal, respectively. Atta chakki delivery followed suit and traded lower by a similar margin to Rs 1,700 -1,705 per 90 kg. Atta flour mills, maida and sooji also settled lower at Rs 940-950, Rs 955-965 and Rs 1,030-1,040 as compared to previous levels of Rs 960-970, Rs 1,000-1,020 and Rs 1,100-1,110 per 50 kg, respectively in line with wheat trend. In the rice section, rice basmati common and Pusa-1121 variety fell by Rs 300 each to Rs 8,000-8,100 and Rs 6,300- 7,400 per quintal, respectively. Non-basmati rice permal raw, wand, sela and IR-8 were quoted lower at Rs 2,275-2,325, Rs 2,400-2,450, Rs 3,000-3,100 and Rs 2,000-2,025 against last close of Rs 2,300-2,350, Rs 2,450-2,500, Rs 3,100-3,200 and Rs 2,050-2,100 per quintal. Other bold grains like, bajra, maize and barley were down by Rs 20 each to Rs 1,370-1,380, Rs 1,500-1,510 and Rs 1,550-1,570 per quintal respectively. Jowar yellow and white too lost Rs 50 each at Rs 1,600-1,650 and Rs 3,300-3,500 per quintal, respectively. Following are today's quotations (in Rs per quintal): Wheat MP (desi) Rs 2,150-2,450, Wheat dara (for mills) Rs 1,695-1,700, Chakki atta (delivery) Rs 1,700-1,705, Atta Rajdhani (10 kg) Rs 240, Shakti Bhog (10 kg) Rs 240, Roller flour mill Rs 940-950 (50 kg), Maida Rs 955-965 (50 kg) and Sooji Rs1,030-1,040 (50 kg). Basmati rice (Lal Quila) Rs 10,700, Shri Lal Mahal Rs 11,300, Super Basmati Rice Rs 9,700, Basmati common new Rs 8,000-8,100, Rice Pusa (1121) Rs 6,300-7,400, Permal raw Rs 2,275-2,325, Permal wand Rs 2,400-2,450, Sela Rs 3,000-3,100 and Rice IR-8 Rs 2,000-2,025, Bajra Rs 1,370-1,380, Jowar yellow Rs 1600-1650, white Rs 3,300-3,500, Maize Rs 1,500-1,510, Barley Rs 1,550-1,570. SUN KPS SBT
  • Rice basmati remains weak on tepid demand

  • New Delhi, May 4 (PTI) Rice basmati prices continued to slide for the fourth day by losing up to Rs 300 per quintal owing to slackened demand at the wholesale grains market today.

    New Delhi, May 4 (PTI) Rice basmati prices continued to slide for the fourth day by losing up to Rs 300 per quintal owing to slackened demand at the wholesale grains market today. However, wheat recovered on scattered demand from flour mills. Traders said easing demand from retailers and stockists kept rice basmati prices lower. In the national capital, rice basmati common and Pusa- 1121 variety drifted further lower to Rs 7,400-7,500 and Rs 6,000-6,800 from previous levels of Rs 7,700-7,800 and Rs 6,000-7,100 per quintal, respectively. Non basmati rice permal raw, wand, sela and IR-8 also finished down at Rs 2,250-2,275, Rs 2,300-2,350, Rs 2,700- 2,800 and Rs 1,875-2,000 from previous levels of Rs 2,275- 2,325, Rs 2,400-2,450, Rs 3,000-3,100 and Rs 2000-2025 per quintal respectively in line with rice basmati trend. On the other hand, wheat dara (for mills) edged up by Rs 15 to Rs 1,705-1,710 per quintal. Atta chakki delivery followed suit and traded higher by Rs 20 to Rs 1,720-1,725 per 90 kg. Following are today’s quotations (in Rs per quintal): Wheat MP (desi) Rs 2,100-2,400, Wheat dara (for mills) Rs 1,705-1,720, Chakki atta (delivery) Rs 1,720-1,725, Atta Rajdhani (10 kg) Rs 240, Shakti Bhog (10 kg) Rs 240, Roller flour mill Rs 940-950 (50 kg), Maida Rs 955-965 (50 kg) and Sooji Rs 1,030-1,040 (50 kg). Basmati rice (Lal Quila) Rs 10,700, Shri Lal Mahal Rs 11,300, Super Basmati Rice Rs 9,700, Basmati common new Rs 7,400-7,500, Rice Pusa (1121) Rs 6,000-6,800, Permal raw Rs 2,250-2,275, Permal wand Rs 2,300-2,350, Sela Rs 2,700-2,800 and Rice IR-8 Rs 1,875-2,000, Bajra Rs 1,350-1,360, Jowar yellow Rs 1,600-1650, white Rs 3,300-3,500, Maize Rs 1,450-1,460, Barley Rs 1,550-1,570.
  • Basmati sowing likely to go up 25% in FY18 on high demand, normal monsoon

  • The industry expects Iran to purchase at least 1 million tonnes this financial year

    Basmati sowing likely to go up 25% in FY18 on high demand, normal monsoon
    Sowing area under paddy is likely to increase by 25 per cent in 2017 on the back of favourable climatic conditions and forecast of normal this season.
     
    The Indian Meteorological Department (IMD) on Tuesday forecasted normal this at 96 per cent of long period average (LPA) with 5 per cent of plus and minus error. 
     
    Late beginning of coupled with dry spells in some parts of major growing regions resulted into less acreage under paddy last year. 
     
     
    Rating agency estimates the area under paddy at 1.6 million hectares for the financial year 2016-17, around 20 per cent decline from the level of 2.1 million hectares in the previous year.
     
    “This year, the area under paddy, however, is estimated to rise at least to the level of 2015-16. There are two major factors which would help farmers to bring in the additional area under this year – favourable and sharp increase in realisation from rice this year,” said Gurnam Arora, joint managing director, Kohinoor Foods, producer of Kohinoor brand rice. "We are confident that rice production and export would also proportionately go up."
     
    Following a sharp decline in acreage, India’s rice output is estimated to have declined by over 18 per cent to 8 million tonnes for 2016-17 compared to 9.8 million tonnes in the previous year.
    rice has witnessed growing demand from the domestic market for past few years. The international demand, though has remained weak for the last two years, it is expected to witness some uptick from this year onwards on Iran, the largest importer, coming back on procurement from India again. rice exports to Iran have started since January–March quarter. The industry expects Iran to purchase at least 1 million tonnes this financial year.
     
    “The Chinese government has identified 14 Indian firms to export rice to that country. Despite the taste being different for consumers, there has been a growing appetite for Indian rice in China. We expect direct export to China to begin very shortly. Currently, India exports a small quantity of rice to China indirectly through Hong Kong,” said Rajan Sundareshan, executive director of All India Rice Exporters’ Association.
    This year, prices of rice have jumped by 50 per cent on the shortage of supply resulting into a proportionate jump in farmers’ income. So, farmers would be encouraged to bring in more area to fetch better realisation this year.
    The rice industry has witnessed moderation over the last few years on the back of subdued international demand, partly attributable to the delay in resumption of imports by Iran. However, FY17 has seen some stabilisation in demand.
    chart
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
     
    “The industry performance in the current financial year has been encouraging as the growth is supported by an increase in volumetric sales, even while prices have remained under pressure. Going forward, FY18 is expected to witness better revenue growth supported by an increase in average realisations, as paddy prices firm up during the current procurement season,” said Deepak Jotwani, assistant vice-president, "Moreover, resumption of imports by Iran will also be crucial for driving industry growth in the next financial year."
    After declining considerably during the procurement season in FY16, paddy prices have firmed up by 20-25 per cent across various varieties, primarily due to relatively lower production, in the recent procurement season (October–December 2016). This is likely to push up rice prices in the next financial year.
    Overall, the export volume in FY17 is estimated to be around 4 million tonnes (almost similar to the volumes in FY16). However, muted average realisations are expected to keep the value of these exports under Rs 21,000 crore, against Rs 22,718 crore in FY16.