West Asia Crisis Hits Basmati Exports From MP, Causes Drop In Price Of Rice Variety

Gulf countries like Iran, Iraq, Jordan, UAE and Saudi Arabia are major exporters of Basmati rice from Madhya Pradesh.

The Basmati rice consignments, destined for the Gulf countries, are stuck in ports due to the Iran war, making it difficult for the exporters to fulfil the orders on time, besides affecting the payment cycle and increasing pressure on the working capital of the industrialists, general secretary of All India Rice Exporters Association, Ajay Bhalotia said.

This apart, shortage of containers and backlog of goods at ports have compounded the problems of the rice exporters, he said.

Rice stocks also got stuck at the rice mills and warehouses due to the Gulf crisis.

“The price of Pusa rice (a Basmati variety) has fallen by Rs 300- 500 per quintal. This has disrupted and reduced the arrival of paddy and raw materials, weakening the supply chain. It has distressed the farmers. If the war continues for a long time, small and medium-sized industries will be particularly affected”, the association members feared.

According to the association, the increase in freight rate has directly increased the cost of exports.

Basmati rice in Madhya Pradesh is primarily produced in the Narmada Valley region, with the districts of Raisen, Sehore, Vidisha and Narmadapuram being the key districts.

The state has pushed for a GI tag for Basmati grown across 13 districts, including Gwalior and Seoni, with production concentrated in the Narmada region.

Raisen district is a major hub where high-quality Basmati, Pusa, is grown and exported with Haryana’s GI (Geographical Indication) tag, a district officer said.

Similarly, high-quality boiled non-Basmati rice, produced in Balaghat district in the state, has a distinct identity, and exported to West Asian and East and West African countries.

Before the West Asia crisis, around 500 tons of boiled non-Basmati rice were exported daily from the Balaghat region.

The West Asia crisis has hit the exports of this rice variety from the region, the association said.