New Delhi: Basmati Rice Market is witnessing a remarkable increase in price since past few weeks. Prices have increased by almost 20% since beginning of the new financial year and it does not seem to plunge anytime soon. Price of 1121 Basmati Steam Rice was at INR 77 Per Kg on 1st April 2019 which has increased to INR 92 Per Kg. Price of 1121 Basmati Sella Rice was at INR 68 Per Kg on 1st April 2019 and it has increased to INR 79 Per Kg. This increase in prices is primarily due to high demand of Basmati Rice from Iran.
Increase in Volume of Basmati Rice Exports
According to Agricultural and Processed Foods Exports Development Authority (APEDA) data, total Basmati Rice exports from India stood at 4.415 Million Tonnes in 2018-19 financial year, which is much higher than previous year’s 4.056 million tonnes. Trade balance has improved in India’s favour due to the high price fetched by export of basmati rice this financial year. The current trend suggests that India will be surpassing its record of basmati rice exports in FY 2019-20. Trade volumes to Iran has increased in FY 2018-19 as the country purchased 1.4 million tonnes of basmati rice compared to previous 1 million tonnes in FY 2017-18.
Increased Buying from Iran
As the data suggests, 25% of basmati rice exported globally is headed to Iran. With this most traders anticipated a decrease in prices when the US Government decided not to renew sanction waivers for import of crude oil from Iran. However, this move seems to have worked in favour of Basmati Rice stockists with increased prices and high demand. New harvest of Basmati rice will arrive by November 2019 and the current stocks are depleted which only indicates prices increasing further in the coming months. We can assume now that Iran will impose ban on import of basmati rice when its local crop harvests in September/October.
Our Prediction
Team of experts at GrainMart predict that the prices will keep on increasing until September 2019 but will decrease as we get closer to the new harvest season.