Jayashree Bhosale, ET Bureau

Synopsis

Basmati rice prices have dropped locally due to disruptions in exports to the Middle East. This key market accounts for half of India’s basmati rice shipments. Industry experts anticipate further price declines if the conflict persists. Around 400,000 tonnes of basmati rice are currently held up at ports and in transit.

Pune: Basmati rice prices have fallen 5% to 6% locally after disruption in exports to the Middle East, a region that accounts for about half of India’s ₹50,000-crore overseas shipments.

The industry expects an even sharper correction in the coming weeks, with more than three-fourths of India’s basmati output typically shipped abroad. Any prolonged slowdown in exports could increase local supplies and put further pressure on prices of the premium grain, said industry executives.

The escalation of the war in the Middle East has meant about 200,000 tonnes of basmati rice are stuck at ports and a similar amount is stuck in transit, said the Indian Rice Exporters Association (IREA). “Basmati rice prices have fallen by about 6% since the war broke out in the Middle East, which is a crucial market for Indian basmati rice exports,” said Dev Garg, vice president, Indian Rice Exporters Federation (IREF). “If the war is prolonged, basmati rice prices in the domestic market can slide further.”

Price Rose 5-10% in February

Basmati rice prices had surged locally in February by 5-10% across varieties due to strong export demand. Iran had increased imports of basmati rice substantially amid the geo-political uncertainties in the region, said exporters. Iran accounts for nearly 40% share of India’s basmati rice exports, shows government data.

However, as India exports more than 75% of the basmati production, lower prices may not generate higher demand.

“We are likely to see some more decline in basmati prices in 15-20 days. However, as there is regional preference for different varieties of rice, the fall in production may not lead to increased demand,” said Rajesh Shah, an exporter of rice from Maharashtra.

Even the exporters are not resorting to panic sales. “We expect that the situation will normalise soon,” said an exporter from Haryana, requesting not to be named.

The impact of lower prices on the farmers is also expected to be limited as most of the farmers have sold their produce. Meanwhile, the exporters have met various central authorities like the APEDA, DGFT and the Commerce Ministry seeking relief from port charges and from arbitrary insurance charges by the shipping companies.

Published Date: March 5, 2026