The cereal’s market is ruling at multi-year lows as buyers hold huge inventories.

By Subramani Ra Mancombu.

India’s rice exports have dropped by nearly 60 per cent in the first two months of the current fiscal on slack demand. In the global rice market, prices continue to rule at multi-year lows, with some of the buyers still holding huge inventories, traders and analysts say. 

“Rice exports have been low over the past two months (April and May). Per tonne prices have dropped below the prices at which the inventories were purchased. Huge volume was purchased in the last quarter of 2024 and first quarter of 2025 as there was a rush to buy after India lifted its curbs on exports in September,” said BV Krishna Rao, President of The Rice Exporters Association. 

Surplus supply

The situation was such that there was no space to unload in January and there was too much cargo floating on the sea, he said. 

“India’s record production and high stocks are keeping global prices low. With supplies exceeding demand, pressure is being exerted in the global market,” said New Delhi-based trade analyst S Chandrasekaran. 

In the case of India, the slack overseas demand is telling. Data show that parboiled (boiled) rice exports jumped from 4.35 lakh tonnes (lt)  in September 2024 to 11.35 lt in October, 10.13 lt in November, 11.01 lt in December and 12.52 lt in January 2025 before slipping 7.92 lt in April and 2.07 lt in May. 

Similarly, white (raw) rice exports increased 6.91 lt in October 2024 from a meagre 30,000 tonnes in September. It further surged to 8.07 lakh tonnes in November before settling around 6 lt in December and 5.22 lt in January 2025. This dropped to 3.04 lt in April 2025 and to 2.92 lt in May.

Monthly shipments

This points to overall exports dropping from around 13 lt a month to a little less than 5 lt. “India exports 16-17 million tonnes (mt) of rice annually. This means, 1.3 mt to 1.4 mt a month. What we are witnessing is a huge fall,” said Chandrasekaran. 

“Due to oversupply in the global market, the trend is bearish,” said Rajesh Jain Paharia, a New Delhi-based exporter. 

Currently, India’s 5 per cent broken white rice is ruling at a five-year low of $384 a tonne free-on-board (f.o.b). Parboiled rice is quoted at $377 f.o.b. Barring 25 per cent broken white rice, India’s offerings are the most competitive. 

“Since February, f.o.b prices are down 20 per cent and the net drop is 40 per cent if you look at the prices when India curbed exports,” said Rao. 

Panic signal?

M Madan Prakash, Director of Rajathi Group that exports agricultural produce, said: “There are hardly any enquiries now. Demand is totally lacking.”

“The slack demand seems universal. India is reporting a drop in exports. At the same time, its competitors are not reporting any increase in shipments,” said Chandrasekaran.

“The declining trend in rice exports continues till this day,” said Paharia. 

Chandrasekaran wondered if the Food Corporation of India (FCI)sent a panic signal of its granaries being full by offering rice to States and for ethanol production at ₹22.50 a kg. 

“It makes one wonder if FCI sent a signal to the global market that India is flush with rice stocks,” he said. 

Bulging stocks

As of June 1, FCI had record stocks of  37.99 mt rice and 32.26 mt of unmilled paddy (21.61 of rice). India had curbed rice exports in 2022 and 2023 as wheat production fell and the government thought rice supplies could fall short of demand, which increased on wheat output woes. 

However, since the second half of 2024, rice stocks have been bulging. This resulted in India removing curbs on rice exports, including on 100 per cent broken rice.  India also became the top producer of rice in 2024-25, producing over 149 mt.

Chandrasekaran said neighbouring countries such as Bangladesh, too, have cut rice purchases from India. But Rao said Dhaka has always been buying rice on and off. 

“Demand has not picked up even after a drop in prices,” he said. 

Chandrasekaran and Rao said India’s rice exports may not touch 24 mt as projected by the US Department of Agriculture.

Published Date: June 11, 2025