As Bangladesh facing floods, the demand for the Indian Rice has increased, hence the rice production also impacted. Also there Srilanka has been under drought, as per report and further for some varieties of Indian rice like Sona Masuri increased the demand. In the export price of rice, the increase in demand has also led to a hike.
For buying nearly 1.5 lakh tonnes of white rice and par-boiled rice, recently Bangladesh has put three tenders in the market. One more tender is expected to come out in the first week of July, as per source.
From India, Bangladesh and Srilanka may import rice and this will improve the rice prices and exports, reported by the exporters.
In this year by nearly 15%, there is an increase in the export rates. In January FOB price of White rice was $360-370/tone and is now trading at around $420-$430/tonne.
The rise in the minimum support price (MSP) by the center and the rupee value strengthening against the dollar are also the reasons for firming of rice costs. For the common rice, the government increased the MSP to Rs.1550/quintal that is an increase of Rs.80/quintal. Against the dollar, the rupee has increased in value from Rs.68 to Rs.64 showing an appreciation of 5-7%.
By the export price hike, the domestic prices, however, may not get impacted as from the export variety; the variety of rice consumed locally is different. As the Monsoon is expected to be normal this year, and then there is an expectation of a normal yield. Already Rice transplantation has started and also reached 16.7 lakh hectares. It was 5% higher than the area used in the same period last year.
The rice production in India in 2016-17, reached 109.15 mt and the target 108.5 mt. for this year, there is a production target of 108.5 mt fixed by the government. In the season 2016-17, the Centre has bought 38.49 mt of rice against the targeted 33.99 mt.