The ban on rice exports imposed by Delhi will force buyers, particularly in Asia and Africa, to pay more for the staple, which has become increasingly expensive in recent weeks.
In September 2022, India banned overseas shipments of broken rice and imposed a 20% duty on exports of various other grades, citing production concerns caused by below-average monsoon rainfall in key growing states.
"Despite the 20% export duty, rice exports did not slow down, and we believe there is no reason to reduce or scrap the duty," said a senior government official. In 2022, India's rice exports increased by 3.5% to a record 22.26 million tonnes (mt). That was more than the next four largest exporters combined: Thailand, Vietnam, Pakistan, and the United States.
"We can't resume broken rice exports just because somebody in China or any other country wants it as a raw material to make ethanol or cattle feed. We'd rather have our domestic industry consume it," the official explained. With 1.1 million tonnes of broken rice purchased in 2021, China was the largest buyer in India.
India will also extend rice export restrictions due to concerns that the El Nino weather phenomenon will disrupt this year's monsoon rains. "We don't want to risk anything. We have limited wheat stocks but plenty of rice, which we can use if the weather surprises us," according to the official.
When the monsoon rains hit India in June and July, farmers plant rice, the most water-demanding crop. "Our restrictions have not deprived the world of rice while maintaining adequate stocks," said another government source directly involved in decision-making. "We'd like to keep the same arrangement."
