India is the second-largest producer of rice after China and also the largest exporter of rice in the world. Production of rice in the country increased from 53.6 million tons in FY 1980 to 120 million tons in FY2020-21. India has exported rice valued at nearly 653 billion Indian rupees in the fiscal year 2021. This figure is significantly higher than the previous year’s export which had amounted to over 454 billion Indian rupees.
More and more buyers are queuing up for Indian rice and even moderate estimates are bringing hope to lots of rice exporters. In this year, buyers from South America have started enquiring about Indian rice and the prospects for export of both basmati and non-basmati rice is looking good.
Import inquiries from South America:
Indian Basmati rice exporters are getting flooded with import inquiries from buyers from the region, which is happening for the first time. Consignments are expected to leave Indian ports in December. The export of both basmati and non-basmati rice is expected to increase to 16 and 17 million tons in 2021 as against last year’s 9.48 million tons.
This new market will more than makeup for the loss of the rice market in Iran due to nonpayment issues. Iran was one of the major destinations for Indian rice; however, payments became irregular after the US imposed sanctions on Iran and there were delays while receiving the same from buyers in the country.
Strong trade ties with Brazil:
Brazil is all set to start importing rice from India in 2021 after agriculture and farmer welfare ministers of the two countries resolved to strengthen their bilateral trade and cooperation in different sectors. Both the countries are dealing with similar issues having significant populations dependent on agriculture. The Brazilian economy is dominated by a large number of small farmers without access to markets and facing a lack of innovation in farming methods. India is expected to benefit from exporting rice to Brazil; Brazil on its part has decided to make efforts to remove bottlenecks coming in the way of bilateral trade.
A Brazilian delegation had interacted with Indian Government Representatives and discussed bilateral trade in January 2020. The official release after the minister’s meeting revealed Brazil’s willingness to import rice and wheat from India. The two countries have a lot in common and mutual cooperation can help them achieve their aspirations and deal with development challenges.
Imports from China further add up the numbers:
By the end of December 2020, China has started importing rice from India first time in three decades. Rice is the staple food in China and the country is looking towards new markets to meet increasing demand. This happened even as the political tensions between the two neighbors deteriorated during that time.
Till recently, China had not been importing rice from India citing quality issues. It was sourced from Pakistan, Thailand, Vietnam, and Myanmar. However, it started looking at Indian suppliers due to limited supply and an increased price of the grain.
As of now, the picture is a bit different. India has emerged to be the top rice supplier to China between January and August 2021. Indian rice made up 23 percent of total imports by Beijing during the period.
This move was due to floods destroying some 13 million acres of agricultural land in July 2020. Then the African flu in pigs led to a shortage of pork and a corresponding increase in the price of pork. This in turn increased food prices, and the country started a global hunt for grains. As it is, China faces the daunting task of feeding 22 percent of the world population with only 7 percent of arable land.