Rising Demand and Export Success
Export demand for Basmati rice is expected to be robust this year, which is great news for farmers of this aromatic variety. They received record prices last year and are now preparing for the upcoming sowing season. A calibrated production approach may help avoid an oversupply situation, which often follows a successful year. Basmati rice shipments hit a record high of 5.24 million tonnes (mt) in the 2023-24 fiscal year. It is up from 4.56 mt the previous fiscal year, marking a 15 percent growth. In value terms, exports of aromatic rice reached a new high of $69,96 billion over $57,36 billion. The per-unit realization also increased.
Quality and Geographical Indication Boost Basmati Prospects
The European Union rejected more shipments of Pakistan’s Basmati rice due to not meeting the maximum residue level (MRL) norms. The likely recognition of India for the Geographical Indication (GI) could increase Indian exports to the EU by 0.5 mt this fiscal year. India had exported 152,881 tonnes of Basmati rice worth $2,00 billion to EU countries in 2023-24, down from 164,138 tonnes worth $2,53 billion in 2022-23. The current geopolitical scenario in West Asia suggests that Basmati rice exports will increase this season. Improved quality from India is expected to boost exports to Europe significantly. India might soon receive Basmati GI recognition from European authorities, further strengthening global market exports.
Punjab Emerges as Largest Producer Amid Yield Variations in Haryana
India produced 9.85 mt of Basmati rice from 2.1 million hectares during Kharif 2023, according to APEDA’s latest report. Basmati paddy prices exceeded $78/quintal (traditional variety) last year due to anticipated higher export demand following Middle East tensions. The APEDA report confirmed a drop in production in Haryana last year, leading to Punjab becoming the largest Basmati producer. Basmati rice production in Haryana was 3.68 mt, while in Punjab it was 3.84 mt. Haryana’s Basmati area increased to 0.78 million hectares in 2023 from 0.66 million hectares a year earlier, but yield losses occurred due to floods and heavy rains. Punjab saw a record area under Basmati at 0.81 million hectares, up from 0.59 million hectares in 2022.
Basmati rice prices are set to rise, supported by robust export demand from Europe and West Asia. The anticipated recognition of India’s Geographical Indication (GI) for Basmati rice and reduced competition from Pakistan due to quality issues will further strengthen the market. Higher export volumes and improving quality standards are expected to drive prices up, making this a favorable period for Indian Basmati rice in the global market.