Asian and African Countries Likely to Bear the Brunt of India (1)

1. Asian and African Countries Likely to Bear the Brunt of India’s Rice Export Ban On 20th July, India, the largest rice exporter in the world, restricted the export of non-basmati white rice in an effort to “ensure adequate domestic availability at reasonable prices” and control rising domestic food prices. The nation is responsible for more than 40% of the world's rice trade. Impacts Of India’s Rice Export Policy Changes The impact of India's ban on non-basmati white rice exports is expected to be felt by millions of people worldwide, with Asian and African consumers expected to be the worst affected. In a recent report, Barclays noted Malaysia's significant reliance on Indian rice and stated, “According to our analysis, Malaysia appears to be the most vulnerable.” The analysts stated that "it imports a significant portion of its rice supply, with India accounting for a relatively large share of its rice imports." Given that India accounts for about 30% of Singapore's rice imports, the city-state is likely to suffer as well. However, Barclays pointed out that Singapore is heavily reliant on food imports in general, not just rice. The nation is currently trying to get exempt from India's restrictions.

2. Currently, rice prices are at a decade-high level, and El Nino is further endangering global rice production in other major Asian rice-producing nations like Thailand, Pakistan, and Vietnam. Given that rice has the highest weight in the Philippines' CPI basket, Barclays noted that the country would be “most exposed to a rise in global rice prices.” However, Vietnam supplies a sizable portion of the country's imports of rice in Southeast Asia. Other Impacted Regions Middle Eastern countries and many African countries are also at risk due to India's ban on the export of non-basmati white rice. According to BMI, a research division of Fitch Solutions, the markets most vulnerable to India's export restrictions are concentrated in Sub-Saharan Africa and the Middle East and North Africa (MENA) region. The countries listed by the company as being the “most exposed” were Djibouti, Liberia, Qatar, the Gambia, and Kuwait. India’s Rice Export Policy After banning shipments of broken rice in September of last year, India has now stopped exporting non- basmati white rice. BMI estimates that up to 40% of India's rice exports are currently offline. Although India has previously altered the export policy of non-basmati rice, this ban may have a wider- reaching effect than in the past. Non-basmati exports were prohibited by India in October 2007, but that ban was later temporarily lifted and reinstated in April 2008, driving up prices by almost 30% to a record high of $22.43 per hundredweight (cwt). The International Potato Center (CIP), a company that conducts agricultural research, claims that prices tripled in a period of six months. According to Samarendu Mohanty, Asian regional director at CIP, India was not a major player in global non-basmati rice exports 16 years ago, and the current ban has "a more far-reaching impact" than the previous ban. The extent of the ban, he continued, would depend on how other rice importers and exporters responded.

3. Market "potential mayhem" According to Mohanty, the rice market could experience "possible mayhem" if major rice importers like Indonesia and Malaysia rush to stockpile and major rice exporters like Vietnam and Cambodia impose their own types of export restrictions. He expressed concern that it might even be worse than the fallout from 2007. According to Mohanty, the number of people affected by the Indian rice ban will be in the millions, and the poorer consumers in India's neighbors, particularly Bangladesh and Nepal, will be the most severely impacted. There is a "very low probability" that the export ban will be lifted, according to Mohanty, who added that the ban will likely remain in place at least through the general elections in India in April of 2024. If you are a rice importer wishing to Buy Rice In Bulk or a rice exporter willing to export bulk rice, then Tradologie.com is the right platform for you. Tradologie is Software as a Service platform that facilitates bulk agro-trade across the globe. Through tradologie’s interface, buyers can avail the best qualities of agro-commodities at negotiable rates. The transaction oriented platform has 600,000+ verified buyers and about 70,000+ registered sellers of agro-commodities from over 150 countries. To register as a buyer, click here. To register as a seller, click here. To stay updated with the latest happenings in the agro-trade industry, follow Tradologie.com across all social media channels.