Rice Exports to Triple this Year

Rice exports (US42EXIN) from India, the world’s second-largest producer, may more than double this year on a record crop and as importers seek alternative to expensive supplies from Thailand, a shippers’ group said.

Shipments, including aromatic basmati rice, may total 6 million metric tonnes in the year ending March 31, compared with 2.2 million tonnes a year earlier, said Vijay Setia, president of the All India Rice Exporters’ Association. Traders have exported more than 1.8 million tonnes of non-basmati rice since India ended a three-year ban in September, he said.

Rising Indian exports may weigh on futures, which posted the first annual gain in three years in Chicago in 2011, and fill a shortfall in supplies from Thailand. Cheaper rice, staple for half the world’s population, may further cool global food costs (FAOFOODI), which dropped for a fifth month in November, according to the United Nations.

“Higher exports from India are pulling global prices lower,” Setia said. “India needs to ship value-added rice to get better prices.”

Global rice harvest is forecast to rise 3 percent to 480.4 million tonnes in 2011, the United Nations’ Food and Agriculture Organization said Dec. 8. Rice futures in Chicago gained 4 percent last year after Thailand, the largest exporter, started a state rice-buying policy at guaranteed prices in October even as the worst floods since 1942 wreak damage on farms.

Thailand’s rice exports (5787766) may drop to 9 million tonnes in 2012 from an estimated 10 million tonnes a year earlier as the government’s purchase boosts prices, Deputy Commerce Minister Poom Sarapon said Dec. 23.

Stockpiles Increase

India won’t curb shipments as domestic stockpiles are comfortable, Food Minister K.V. Thomas said last week. State inventories climbed 16 percent to 29.7 million tonnes as of Jan. 1 from a year earlier, the Food Corp. of India said on Jan. 6.

Rough-rice futures for March delivery advanced as much as 0.7 percent to $14.785 per 100 pounds on the Chicago Board of Trade on 9 January and was at $14.705.

Indian traders have contracted to ship 2.24 million tonnes of basmati rice in the nine months through Dec. 31. more than the 2.16 million tonnes a year ago, Setia said. The contracts may rise to 3.5 million tonnes for the full-year, while actual shipments may be 2.5 million tonnes, he said.

Shipments fetched an average $968 a tonne in 2011 as against $1,110 a tonne a year earlier, he said.

India may harvest a record 102 million tonnes in 2011-2012 season ending June after farmers boosted rice planting and the crop escaped damage from floods or pest attacks, he said.