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Indian rice prices rise as Asian nations prepare for El Nino

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White rice (uncooked) prices have risen across Asia as most countries that rely on the cereal as a staple food are building shares to combat the El Nino, which is expected to thrive in the second half of 2023. “Rice prices are up as countries like Indonesia, the Philippines, and Malaysia need to buy more rice,” said BV Krishna Rao, President, The Rice Exporters Association of India (TREA).

“Islands in the Philippines may request more. Malaysia’s market is open. VR Vidya Sagar, Bulk Logix Director, said Vietnam is also contacting them. “Unused crop arrivals are likely in Vietnam by month-end. M Madan Prakash, President, Agri Commodities Exporters Affiliation (ACEA), said customers want faster shipments.

Indonesia, the Philippines, and Malaysia are preparing for El Nino. S Chandrasekaran, business analyst, said they don’t want to repeat 2007-08’s farm commodities price explosion.

2007-08 disaster
India prohibited rice exports in 2007–08, raising global prices to $1,000. According to the UN’s Food and Agriculture Organisation (FAO), it destroyed the Scanty. “If the federal government helps maintain its Encourage, shall we finish up exporting the same quantity of rice like last fiscal,” said Rajesh Paharia Jain, a New Delhi-based exporter.

According to the World Grains Council, India’s 25% damaged white rice costs $442 per tonne, while Thailand and Vietnam charge $490 and $480. Indian rice prices rose 27% year-over-year, surpassing Thailand (11%), Vietnam (16%).

FAO predicts El Nino will harm maize, rice, and soyabean production.

Key building
El Nino is expected to begin in August by the India Meteorological Division (IMD) and July-end by the Australian Bureau of Meteorology. The US Weather Prediction Centre expects the development, which causes drought in Asia and floods in the Americas, to continue through June. “Some of the key trends within the international rice markets is that consumers have approved the 20 percent export duty on white rice,” said Jain, citing the three percent increase in rice exports in the 2022-23 fiscal.

Those Asian countries are buying so they won’t be stopped at any bar that India may build to verify food safety like it did last year when it banned wheat and completely ruined rice exports’, said Chandrasekaran.

“India won’t sacrifice its food safety, although it could maintain least advanced countries’ wishes,” he said.

Parboiled below drive
“We’re getting 25% damaged Chennai supplies at 28,500 a tonne. Two weeks ago, we exported to Southeast Asia at $430 per tonne. According to Prakash of ACEA, prices have increased. Again, parboiled rice prices are emphasised. “There’s no (Indian) executive procurement so costs are falling,” said Bulk Logix’s Sagar.

White rice prices are rising because the Food Company of India (FCI) is buying shares for the central pool to be distributed through ration stores and to combat food emergencies.

FCI’s rice procurement topped 50 million tonnes (mt) last week and is on track to meet the 62.17 mt goal for the current marketing year to September.

Report output
Due to little demand, Indian parboiled rice costs $380 a tonne internationally. Thailand and Pakistan face over $100/tonne aggression.

Rice shares with FCI were at a five-year low until April 1, and Add foodgrain shares, including wheat, were also low due to wheat procurement issues last year.

Last year, low wheat production hindered procurement, while surplus rice was diverted for ration store distribution.

India’s rice exports were bolstered by report manufacturing of 130.83 mt (129.47 mt a year earlier) of rice over the current crop year to June. Due to higher rabi acreage, kharif rice production declined to 108 mt from 111 mt a year earlier.

Info Sources- India Daily Mail, Business Journal

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