India’s basmati growers and shippers are reaping robust profits and are looking at good tidings ahead in the new year due to brisk overseas orders and a busy wedding season at home, which have pushed up prices to a record high, analysts said.
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The top agricultural export item, prized for its aroma and long grain, is witnessing a demand surge from traditional global buyers in the Middle East, the US and European Union, fuelling a global rice price spiral.
Millers also point to a wedding season and changing consumption patterns among rice consumers as a new source of domestic demand for basmati. Wholesalers say there’s been a 15% surge in procurement demand from dealers and distributors nationwide this winter.
In the new season, over 600,000 tonne have been contracted for exports, while the value of overseas shipments totalled over $3 billion till November, bulk buyers said.
Heavy demand has knocked up prices from around ₹46,000 a tonne in the previous season to about ₹50,000-52,000 tonne last week for some top grades of the grain, up 30%, a bulk buyer said, requesting not to be named.
{{/usCountry}}Heavy demand has knocked up prices from around ₹46,000 a tonne in the previous season to about ₹50,000-52,000 tonne last week for some top grades of the grain, up 30%, a bulk buyer said, requesting not to be named.
{{/usCountry}}An ongoing wedding season at home has “set a new tempo for the industry”, said Atul Garg, managing director of GRM Overseas, an exporter to 38 markets worldwide. “Families crafting memorable culinary experiences for guests now consider basmati an essential element of celebration.”
A pick-up in exports has been helped by India’s lowering of the minimum export price from $1,200 a tonne to $950 a tonne last month. The move has made Indian basmati rice shipments competitive again in global markets, said Kuldeep Nagar of Bharati Impex, a distributor to overseas sellers.
Non-availability of most other long grain white rice varieties due to a ban on cereal export by the world’s largest exporter of the grain has also stoked demand for basmati.
“Distributors are offering up to ₹50,000 a tonne for my grade and this is one of the best seasons I have seen in five years,” said Karamveer Singh, a grower from Punjab’s Pathankot.
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Better volumes of basmati export could help narrow India’s agricultural trade gap this year because the country has banned shipments of white rice, wheat and onion to cool domestic prices.
KRBL Ltd, a top seller, has seen strong growth in the domestic market for its India Gate brand, according to a company representative. The demand for premium grades of basmati rice shows a “remarkable” 25% year-on-year increase, GRM’s Garg said.