Newsnomics AJAY ANGELINA reporter |

India's basmati rice exports are likely to decrease in 2024 after nearing a record high last year, as rival Pakistan

is offering the grain at competitive prices amid a rebound in production, according to the industry officials.

Both, Pakistan and India are the leading exporters of the premium long-grain variety of rice, famous for its aroma, to countries such as Iran, Iraq, Yemen, Saudi Arabia, the United Arab Emirates, and the United States.

In 2023, India’s basmati rice exports increased by 11.5% compared to the previous year, reaching 4.9 million metric tons, contributed to India’s record earnings of $5.4 billion in 2023, a 21% rise from the previous year.

This surge was due to lower supplies from Pakistan and stocking efforts by importing countries, industry officials said.

However, this year, Pakistan’s increased production has led to lower prices, making its exports more appealing.

Pakistan's total rice exports could jump to 5 million tons in 2023~24 financial year, 3.7 million tons rise from the last year, Chela Ram Kewlani, the chairman of Rice Exporters Association of Pakistan (REAP) said last month.

"As compared with last year, the price of rice has increased by 25% to 30%, which has helped the country earn more of foreign exchange through shipments of the commodity," said Kewlani.

In the seven months of the current fiscal year, exports amounted to $2.1 billion as compared with $1.083 billion, registering an increase of 95%, showcase the governmental data.

Basmati rice exports fetched on an average $1,146/mt compared with $1,044/mt last year while non-basmati on an average fetched around $567/mt whereas last year it worked out to be $449/mt, Hamid Malik, a commodity expert, said.

Indian Vijay Setia, a leading exporter based in Haryana state said, “Last year, buyers were hustling to stock up when Pakistan was facing production issues. This year, however, Pakistan offers lower prices than India due to increased production." 

The depreciation of the Pakistani rupee has made Pakistan's exports more competitive, according to Akshay Gupta, head of bulk exports at KRBL Ltd, India.

Meanwhile, the lower export demand amid an estimated 10% rise in India's basmati rice production has started pulling down basmati prices in that country, said Gupta.

According to the data shown by India's Ministry of Commerce and Industry, Iran, the biggest buyer of Indian basmati rice, slashed purchases by 36% in 2023, but higher shipments to Iraq, Oman, Qatar, and Saudi Arabia offset the shortfall.

In August, India imposed the MEP on basmati rice shipments at $1,200 per ton, exceeding prevailing market rates, before lowering it to $950 in October, but they quickly recovered, said a New-Delhi-based exporter.

However, exports began faltering again in January, and may decline further in the near term as buyers delay purchases due to increased freight costs caused by disruptions in shipping via the Red Sea, exporter Vijay Setia said.

"Buyers are holding ample inventory; there's no need for them to rush," he added