Rice prices have soared around 28% since November 2016 till January end in many states of North India on account of low rabi sowing. As per reports, this year rice sowing has also declined by more than 11% than the same time last year.
As of February 3, rice has been sown in an area of 25.64 lakh hectares as compared to 29.03 lakh hectares the same time last year. The average area for the season is around 43.58 lakh hectares in the country.
As per reports, Iran has reduced rice import from 40% to 26%. This in turn, is expected to boost basmati export to Iran from India in the current season.
After hitting a record $4.88 billion in 2013-14, India’s basmati export earnings were on a declining trend over the past three years. Both in terms of low prices and purchases by Iran, which is its largest buyer.
To increase the domestic production of 2 million tons, Iran imports about 1 million tons of rice every year, out of which about 7 lakh tons is exported from India.
However, purchase by Iran has been on a steady decline in the past three years. From a high of 14.40 lakh tons in 2013-14, it dropped to 9.36 lakh tons in 2014-15 and came down even more to 6.95 lakh ton in 2015-16.
The quality of Kharif crops is also low due to moisture. Moreover, as few months are still left for fresh Rabi crops, prices are expected to rise further.
So far the weather remained favorable for Rabi rice-growing states. Rabi rice contribution to total production is just 15% and rest 85% comes from Kharif crops.
In such scenario, it’s hard to say that Rabi Rice will affect the price rise or not.
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