India, the world’s leading rice exporter, has immediately halted exports of non-basmati white rice in a bid to stabilize domestic prices ahead of the upcoming general election in 2024, according to the Directorate General of Foreign Trade.
The decision confirms that India will only authorize overseas shipments to countries in dire need of the grain for food security, following requests from respective governments, according to a Bloomberg report.
The move, while potentially reducing domestic rice prices, could contribute to a global price surge amid rising concerns about crop damage due to the resurgence of the El Niño weather pattern.
Tensions in the Black Sea region, with apprehensions about Russia’s possible weaponization of the food trade, are already causing a rise in the cost of other major grains.
This latest restriction on the export of rice, a staple food for about 50% of the world population, follows India’s previous limitations on wheat and sugar exports. It is anticipated to impact approximately 25% of total rice shipments from India, as per a government statement.
BV Krishna Rao, president of the Rice Exporters Association, lamented the decision, expressing concerns about the impact on African nations that rely heavily on Indian rice supplies.
He indicated that the association would lobby the government to lift the ban as soon as the domestic rice price situation improves.
India has been battling escalating food prices across multiple categories, including grains, fruits, and vegetables. Retail rice prices in Delhi have risen about 15% this year, and the nationwide average increase is over 8%, according to the food ministry.
The ban follows India’s similar actions last year when it banned the export of broken rice and levied a 20% duty on white and brown rice exports in response to the spike in global staple food prices after Russia’s invasion of Ukraine.
The government has clarified that exporters who had already commenced loading the grain onto ships at the time of the ban will be permitted to proceed with their shipments. Non-basmati parboiled rice and basmati rice exports are not affected by the ban, ensuring local farmers will continue to benefit from favorable global prices.
GlobalTradeTimes
