India’s basmati rice exports are anticipated to decrease in 2024 after nearly reaching a record high last year. Rival Pakistan is reportedly offering competitive prices following a rebound in production. Both India and Pakistan are key exporters of the premium long-grain basmati rice variety to countries such as Iran, Iraq, Yemen, Saudi Arabia, the United Arab Emirates, and the United States.
In 2023, India’s basmati rice exports rose by 11.5% from the previous year to 4.9 million metric tons, coming close to the record of 5 million tons in 2020. This surge contributed to India, the world’s largest rice exporter, achieving a record $5.4 billion in exports in 2023, a nearly 21% increase from the previous year.
However, industry officials note that this year, Pakistan is offering lower prices due to increased production, leading to a potential decline in India’s exports. Islamabad’s total rice exports are expected to reach 5 million tons in the 2023-24 financial year, up from 3.7 million tons the previous year.
The depreciation of the Pakistani rupee has made its exports more competitive, according to industry experts. Simultaneously, lower demand for exports amid an estimated 10% rise in India’s basmati rice production has begun affecting basmati prices in India.
While Iran, the largest buyer of Indian basmati rice, reduced purchases by 36% in 2023, increased shipments to Iraq, Oman, Qatar, and Saudi Arabia offset the decline. The imposition of a minimum export price on basmati rice in India in August initially affected exports, but they recovered quickly after the price was lowered in October.
However, challenges such as increased freight costs and disruptions in shipping via the Red Sea have impacted exports since January. Industry experts suggest that buyers are holding sufficient inventory, leading to a potential further decline in exports in the near term.
