Srinagar, Sept 16: As the union government has decided to abolish the minimum export price (MEP) of $950/tonne on basmati rice, imposed a year ago, J&K’s farmers are expecting to yield better returns this year.
Basmati is grown mainly in Jammu plains and parts of Kashmir valley, and has been fetching farmers better prices compared to traditional varieties. In FY24, India exported a record 5.24 MT of aromatic rice, valued at $5.83 billion, about Rs 51,000 crore.
On the abolition of MEP for basmati rice, the commerce ministry stated in a statement received by Ziraat Times that the Agricultural and Processed Food Products Export Development Authority (APEDA) will closely monitor export contracts to prevent non-realistic pricing of basmati rice and ensure transparency in export practices.
The ministry said the floor price of $1,200/tonne, introduced in August 2023, was a temporary measure to address rising domestic rice prices and to curb the potential misclassification of non-basmati rice as basmati in light of the export prohibition on non-basmati white rice. The MEP on aromatic and long-grain rice was reduced to $950/tonne in October 2023.
The aromatic and long grain rice commands a premium in the global market.
India commands around 80% of the global aromatic rice market, with Pakistan holding the remaining 20% in basmati rice exports. Geographical Indication (GI)-tagged basmati rice is grown in around 70 districts across Punjab, Haryana, Western Uttar Pradesh, Jammu & Kashmir, and Uttarakhand.
Several exporters of aromatic and long-grain rice have urged the government to also lift the export prohibition on non-basmati white rice and the 20% export duty on par-boiled rice. This, they said, will prevent the misclassification or illegal shipment of non-basmati rice, which could benefit from the removal of the MEP on basmati rice.
Trade sources have reported a recovery in the mandi price of the early harvested 1509 basmati paddy variety. Prices, which had dropped to Rs 2,400/quintal earlier this month from Rs 3,000/quintal a year ago, have now climbed back to around Rs 2,900/quintal in recent days.
