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July 2024

Ministers’ panel seen fixing a floor price of $500/tonne on non-Basmati rice exports 

Cut Basmati minimum export price may be deferred


The committee of ministers headed by Home Minister Amit Shah may decide this week on a proposal to fix a minimum export price (MEP) of $500/tonne on shipments of non-basmati rice, while the proposal to reduce the current MEP of $950/tonne on Basmati rice may be deferred for now, sources said.

Last week, the Commerce Ministry held a meeting with exporters to understand their concerns and, accordingly, some proposals have been finalised for the ministerial panel to consider, official sources said without disclosing the proposed changes.

However, industry sources said though the demand was to replace the current 20 per cent export duty with a fixed $90/tonne tax, the government has finalised it at $100/tonne after considering the likely MEP of $500/tonne. The fixed tax will be valid on both parboiled rice, which is allowed to be shipped duty-free, and on white (raw) rice shipped through the canalising agency National Cooperative Exports Limited (NCEL).

The industry’s other demand to reduce Basmati’s MEP to $800-850/tonne is likely to be deferred for now, the sources said.

Basmati realisation up

businessline last month had reported the Commerce Ministry’s likely move to seek a decision from Shah-led panel to make suitable changes in the export duty structure on parboiled non-Basmati rice and also to seek a direction on industry’s demand to cut MEP of Basmati rice.

According to India’s export data, the per unit average realisation of Basmati rice was $1,070/tonne in April and rose a tad to $1,080/tonne in May. On the other hand, the average export price of non-Basmati rice was about $476/tonne in April and $474/tonne in May.

Meanwhile, Basmati exports from India rose 17 per cent to 0.97 million tonnes (mt) in first two months of 2024-25 fiscal from 0.83 mt in the year-ago period. But shipments of non-Basmati exports dropped 32 per cent to 1.94 mt from 2.85 mt. QR Code

Published Date: July 8, 2024

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