India's rice exports could jump to record on Thai drought effects
By Rajendra Jadhav
MUMBAI (Reuters) - India's travel exports in 2020 could rise nearly 42% year over year and hit record highs due to lower supplies from competing exporters and a depreciating rupee, industry officials said this week.
Increased shipments from India, the world's largest travel exporter, could cap world prices, reduce the country's high inventory levels and limit purchases from Indian stockists from farmers.
India's travel exports could rise to 14 million tons in 2020, up from 9.9 million tons last year, the lowest level in eight years, said B.V. Krishna Rao, President of the Rice Exporters Association.
"Thailand's deliveries are declining due to the drought. Vietnam is struggling because of a lower harvest. That proportion naturally comes to India," said Rao.
Thailand, the world's second largest rice exporter, suffered a drought earlier this year that affected the rice harvest. Deliveries in 2020 could drop to 6.5 million tons, the lowest level in 20 years.
Vietnam, the third largest global exporter, is grappling with low water levels in the Mekong Delta, the country's main rice-growing area, which has limited supplies.
India mainly exports non-basmati rice to Bangladesh, Nepal, Benin and Senegal as well as premium basmati rice to Iran, Saudi Arabia and Iraq.
India's rice shipments in 2020 will increase due to robust demand for non-Basmati rice from African countries, said Nitin Gupta, vice president of Olam India's rice business.
"The demand for basmati rice is more or less stable, but non-basmati rice has risen sharply due to attractive prices," said Gupta.
India's exports of non-basmati rice could double year over year to 9.5 million tons, while exports of basmati rice would remain stable at around 4.5 million tons, he said.
India offered 5% broken parboiled rice for $ 380 per ton on board, while Thailand offered the same quality for $ 490 per ton, traders said.
Indian exporters have been selling rice at lower prices at a time when world market prices have soared on limited supplies due to the devaluation of the rupee, Rao said.
The rupee has fallen 3% against the US dollar so far this year.
In addition to lower sales in Southeast Asia, China also cut exports to Africa after floods hit local crops, said a Mumbai-based trader with a global trading firm.
"Unlike other countries, India has a massive surplus. Exports do not lead to bottlenecks in the local market," said the trader.
In addition, the higher exports should curb India's inventory levels and limit government purchases from farmers at minimum support prices, said Rao of the Rice Exporters Association.
(Reporting by Rajendra Jadhav; editing by Christian Schmollinger)
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