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Export ban & duty imposed; Indian ports stuck with ‘one million tonnes’ of rice!

The export of damaged rice was forcibly prohibited by the Indian government last week. Additionally, in order to increase domestic supply, the Centre levied a 20% export levy on all types of rice outside Basmati, excluding parboiled rice. The government’s new 20% export tariff has caused roughly one million tonnes of grain to become stuck at Indian ports, according to a Reuters report.

‘Although the duty took effect at midnight, customers are not prepared to pay the fee. The loading of ships has ended’.  the All India Rice Exporters Association’s (AIREA) president, B.V. Krishna Rao, was cited in the article. Approximately 750,000 tonnes of rice that may be exported are currently sitting in Indian ports, according to AIREA. Due to the razor-thin margins in the rice industry, however, the purchasers are unwilling to pay the levy, leaving the rice destined for Benin, Sri Lanka, Turkey, and the United Arab Emirates trapped.

Additionally, there are various ports located all throughout India that have at least 350,000 tonnes of broken rice. The rice cannot be sent back into the hinterland for sale due to logistical reasons. The future of the stock is uncertain due to the government’s total export restriction on broken rice, and exporters are waiting for some regulatory slack from the government. Due to subpar output, the government was obliged to impose restrictions on rice export.

According to reports, the Kharif season might see a decline of 10–12 million tonnes due to a severe rain shortfall that affected the crops in several regions that produce rice. Being the world’s largest rice exporter, India is notable, and any restrictions imposed by the Indian government are anticipated to have an effect on the worldwide market. The nation exported more than 21 million tonnes of rice in 2021. Only 10 million tonnes will, however, enter the world’s supplies because of the constraints and low output.


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