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India may ease ban on broken rice exports

View: 30 Author: Site Editor Publish Time: 2022-11-21 Origin: site

India may ease ban on broken rice exports

According to foreign news on November 16, two people familiar with the matter said that with the steady progress of rice purchases and prices starting to fall, India's central government may re-evaluate the ban on the export of broken rice.

However, the possibility of a complete lifting of the ban is currently ruled out. Exports could still face some restrictions, through the imposition of tariffs rather than a blanket ban, but that is still under discussion, they added.

India, the world's largest exporter of broken rice, imposed an export ban in September to stabilize domestic prices and ensure supplies for the domestic market, especially for the ethanol and poultry industries.

Before the ban, India's broken rice exports in the April-August period of the 2023 fiscal year increased by 4.178% compared to the same period in 2019. Between fiscal year 2018 and fiscal year 2019, exports jumped by about 319%. Of the 3.8-3.9 million tonnes of broken rice exported in fiscal 2022, about 1.6 million tonnes, or more than 41 percent, were sent to China for feed use in the poultry industry, the data showed.

India's total rice exports are estimated at around 21.2 million tonnes during 2021-22, with the share of broken rice in total exports rising to 23% in April-August 2022 from 1.34% in the same period in 2019 .

However, some weakness in domestic prices, a steady start to the 2022-23 rice buying season and demand from southern processing plants could prompt the central government to consider lifting the ban, the sources said.

As of November 10, India's central rice purchases for 2022-23 (starting in October) are estimated to be about 23.1 million tons, an increase of 1.31% over the same period last year.

In 2022-23 (October-September), the central government plans to purchase 77.1 million tonnes of rice, up from 75.9 million tonnes last year.

Meanwhile, India's Commerce and Industry Minister Piyush Goyal discussed the issue while reviewing progress in the export sector with the Export Promotion Council and industry bodies, market sources said. The industry has expressed concerns about continuing the ban on broken rice exports, said one of the people familiar with the matter.

India produces 5-6 million tonnes of broken rice a year, mainly for poultry and cattle feed, market sources said.

According to the preliminary forecast of agricultural production for the 2022-23 crop year (July-June) released a few months ago, India's rice production star for the 2022-23 autumn harvest season is estimated to decrease by about 6.05% from the same period last year to 104.99 million Ton. Rice production for the 2021-22 autumn harvest hit a record high of 111.76 million tonnes.

If the forecast data is confirmed, it will be the lowest rice harvest for the autumn harvest since the 2020-21 crop year. Production is expected to drop due to dry conditions in the main growing regions of East India, namely Uttar Pradesh, Bihar, Jharkhand and West Bengal, and some other states may also switch to other competing crops.