Iran imports likely to help boost India's basmati realisation

After a sluggish beginning in the first half of the current fiscal, realisation from India's basmati rice exports is likely to rise in the next couple of months, with Iran likely to resume rice imports shortly.

Official sources told The Financial Express that the realisation from the exports of aromatic and long-grain rice rose to $800 a tonne last month from $750 a tonne prevailing in the last couple of months. A commerce ministry official said that export realisation could reach $900 a tonne in the next couple of months because of lesser supplies due to lower production and firming up of global demand.

Iran, the biggest export destination for India's basmati rice, is likely to resume imports of rice shortly. The government is sending a trade delegation to Iran later this month for working out modalities for rice exports.

According to official data, in the current fiscal, the volume of basmati rice exports to Iran has been around 4.6 lakh tonnes, which was essentially from contracts agreed upon in the previous financial year. The volume of basmati rice exports to Iran had crossed a million tonne (mt) mark in in FY15.

''Iran is expected to take a call on resuming rice imports from India shortly,'' a commerce ministry official said. The official also said that due to lower output of basmati rice this year, the prices have started to appreciate in the last couple of weeks. The sowing of basmati across the key growing areas of Punjab, Haryana, western Uttar Pradesh and Uttarakhand had seen a sharp fall of 25 per cent to 1.57 million hectares in the last kharif season, from close to 2 million hectares reported in 2015, thanks to a fall in realisation from exports.

But exports of aromatic and long-grained basmati rice fell more than 13 per cent during April–October this fiscal.