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Zawya
28-05-2025
- Business
- Zawya
India raises purchase price of rice by 3%, lowest increase in five years
India has raised the price at which it will buy the new-season common rice paddy variety from local farmers by 3%, the lowest increase in five years, as New Delhi struggles to manage overflowing granaries after last year's record harvest. India is the world's second-largest producer of rice and the biggest exporter in the world with a market share of more than 40%. For the common grade of rice paddy, the government has fixed the support, or guaranteed price at 2,369 rupees ($27.76) per 100 kg (220.46 lb), up from 2,300 rupees last year, Information and Broadcasting Minister Ashwini Vaishnaw said on Wednesday. Last year, India raised the rice paddy purchase price by 5.4%. The small rise in the support price will help exporters remain competitive in the world market against rivals such as Thailand and Vietnam, B.V. Krishna Rao, president of the Rice Exporters Association told Reuters. Every year authorities raise the support price of staples such as rice and wheat to build stockpiles to run the largest food welfare programme in the world, providing access to free grains for those most in need. But rice stocks, including unmilled rice paddy, in government warehouses totalled 59.5 million tons on May 1, more than four times a government target. The government is sitting on excess rice stocks and struggling to sell them, said a Mumbai-based dealer with a global trade house. "It doesn't want a big spike in production since that would mess things up. It's hoping farmers switch to other crops instead," the dealer said. Rice yields are affected by seasonal monsoon rainfall as rice is a water intensive crop. India's weather department has forecast above-average monsoon rainfall for the second straight year in 2025. India also raised the cotton purchase price by 8.3% to 7,710 rupees per 100 kg and the soybean price by 8.9% to 5,328 rupees per 100 kg. (Reporting by Rajendra Jadhav and Mayank Bhardwaj; Editing by Sudipto Ganguly and Rachna Uppal)
Reuters
28-05-2025
- Business
- Reuters
India raises purchase price of rice by 3%, lowest increase in five years
NEW DELHI, May 28 (Reuters) - India has raised the price at which it will buy the new-season common rice paddy variety from local farmers by 3%, the lowest increase in five years, as New Delhi struggles to manage overflowing granaries after last year's record harvest. India is the world's second-largest producer of rice and the biggest exporter in the world with a market share of more than 40%. For the common grade of rice paddy, the government has fixed the support, or guaranteed price at 2,369 rupees ($27.76) per 100 kg (220.46 lb), up from 2,300 rupees last year, Information and Broadcasting Minister Ashwini Vaishnaw said on Wednesday. Last year, India raised the rice paddy purchase price by 5.4%. The small rise in the support price will help exporters remain competitive in the world market against rivals such as Thailand and Vietnam, B.V. Krishna Rao, president of the Rice Exporters Association told Reuters. Every year authorities raise the support price of staples such as rice and wheat to build stockpiles to run the largest food welfare programme in the world, providing access to free grains for those most in need. But rice stocks, including unmilled rice paddy, in government warehouses totalled 59.5 million tons on May 1, more than four times a government target. The government is sitting on excess rice stocks and struggling to sell them, said a Mumbai-based dealer with a global trade house. "It doesn't want a big spike in production since that would mess things up. It's hoping farmers switch to other crops instead," the dealer said. Rice yields are affected by seasonal monsoon rainfall as rice is a water intensive crop. India's weather department has forecast above-average monsoon rainfall for the second straight year in 2025. India also raised the cotton purchase price by 8.3% to 7,710 rupees per 100 kg and the soybean price by 8.9% to 5,328 rupees per 100 kg.
Business Times
07-05-2025
- Business
- Business Times
Global rice prices have hit a floor, but India's supply glut will smother any gains
[MUMBAI] Global rice prices, which have tumbled to multi-year lows, are unlikely to fall further with top exporter India's currency firming, but bulging Indian stockpiles and a bumper Asian crop will cap any rebound this year, industry executives say. While lower rice prices will benefit price-sensitive consumers in Africa and other regions, they are likely to further squeeze the already meagre earnings of farmers across Asia, which produces nearly 90 per cent of the world's rice. The market slumped in April, a month after Delhi removed the last of its export curbs on the grain imposed in 2022, sending Indian parboiled rice export prices to a 22-month low. Prices in Thailand dropped to their lowest in more than three years, while in Vietnam, they sank to near five-year lows. Following a slide of nearly one-third from their 2024 peaks, prices have found a floor, traders and industry executives said, but will hold there for the rest of 2025 limited by surpluses in all major exporting countries. 'Even after the recent significant correction, we don't expect a price rebound. The supply glut will likely prevent prices from increasing,' said BV Krishna Rao, president of the Rice Exporters Association. The association expects prices will fluctuate within a US$10 range around US$390 per tonne for 5 per cent broken rice for the rest of the year. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up 'Prices will remain around the current level unless the monsoon pulls a surprise and affects production,' said Himanshu Agrawal, executive director at Satyam Balajee, a leading rice exporter. Bumper outlook for Indian exports A good spell of monsoon rains is vital for the rice crop, which requires copious amounts of water. India's state-run weather office has forecast above-average monsoon rains for a second consecutive year in 2025, which will boost production. Global rice output is expected to reach a record 543.6 million tonnes in 2024/25, up from 535.4 million tonnes the previous year, according to estimates from the Food and Agriculture Organization. Total global supply, including stocks, is seen at 743 million tonnes, well above demand that is expected to rise to 539.4 million tons, the FAO estimates. In India alone, rice stocks, including unmilled rice paddy, in government warehouses totalled 63.09 million tonnes on Apr 1, nearly five times a government target of 13.6 million tonnes. With massive stocks and the expected rebound in production, buyers are in no rush to make purchases, while sellers are competing for market share – keeping global prices under pressure, said Agrawal. The Rice Exporters Association expects shipments from India to rise by nearly 25 per cent from a year earlier to a record 22.5 million tonnes this year. Olam Agri India, one of the world's top rice exporters, is even more bullish, projecting exports could climb to as much as 24 million tonnes. The jump is likely to propel India back to its dominant share of the global market, which stood at more than 40 per cent before it curbed exports in 2022, surpassing the combined sales of the next four largest suppliers – Thailand, Vietnam, Pakistan, and the US. 'India has already started to reclaim its lost market share,' said Nitin Gupta, senior vice-president at Olam Agri India. Rupee rebound, state demand create a floor When India's broken rice came back to the market in March, demand was stoked by a weak rupee, trading around 87.2 against the US dollar, which helped to drive prices down. However, the rupee has since recovered to 84.55 against the US dollar, and other exporting nations' currencies have strengthened, too, which has prevented global rice prices from falling further, three grain dealers said. Further providing a floor, Indian farmers have the option to sell paddy to the government. If exporters begin offering lower prices than the state-fixed price, farmers will start selling to the government. The government raises its minimum support price annually, another factor that will keep export prices from dropping further. Rattled rivals Forecasts of higher supplies from India have rattled rival suppliers. In the first quarter of 2025, Thailand's rice exports fell 30 per cent to 2.1 million tonnes, as India offered the staple at lower prices prompting buyers to switch, said Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association. For 2025, Thailand's exports are likely to drop 24 per cent from a year ago to 7.5 million tonnes, while Vietnam's are expected to fall 17 per cent, also to 7.5 million tonnes, trade bodies in the two countries estimate. A 30 per cent year-on-year slide in rice paddy prices in Thailand in February sparked protests by farmers and prompted the government to offer a subsidy to rice growers. In an effort to support its farmers, Thailand has sought cooperation from India and Vietnam to address falling rice prices, the Thai commerce minister said in March. Benefiting from the price slump are the top rice-importing countries – the Philippines, Indonesia, Saudi Arabia, and African countries such as Senegal, Nigeria, and Ghana. In Ivory Coast, rice demand has grown with an influx of people from neighbouring countries, said Yacouba Dembele, director of the Agency for the Development of the Rice Sector. 'India's export curbs were a bonanza for other Asian suppliers in the past two years. Now, the resumption in exports would make buyers happy with the moderation in prices,' said Rao at the Rice Exporters Association. REUTERS
CNA
07-05-2025
- Business
- CNA
Analysis:Global rice prices have hit a floor, but India's supply glut will smother any gains
MUMBAI :Global rice prices, which have tumbled to multi-year lows, are unlikely to fall further with top exporter India's currency firming, but bulging Indian stockpiles and a bumper Asian crop will cap any rebound this year, industry executives say. While lower rice prices will benefit price-sensitive consumers in Africa and other regions, they are likely to further squeeze the already meagre earnings of farmers across Asia, which produces nearly 90 per cent of the world's rice. The market slumped in April, a month after Delhi removed the last of its export curbs on the grain imposed in 2022, sending Indian parboiled rice export prices to a 22-month low. Prices in Thailand dropped to their lowest in more than three years, while in Vietnam, they sank to near five-year lows. Following a slide of nearly one-third from their 2024 peaks, prices have found a floor, traders and industry executives said, but will hold there for the rest of 2025 limited by surpluses in all major exporting countries. "Even after the recent significant correction, we don't expect a price rebound. The supply glut will likely prevent prices from increasing," said B.V. Krishna Rao, president of the Rice Exporters Association. The association expects prices will fluctuate within a $10 range around $390 per ton for 5 per cent broken rice for the rest of the year. "Prices will remain around the current level unless the monsoon pulls a surprise and affects production," said Himanshu Agrawal, executive director at Satyam Balajee, a leading rice exporter. BUMPER OUTLOOK FOR INDIAN EXPORTS A good spell of monsoon rains is vital for the rice crop, which requires copious amounts of water. India's state-run weather office has forecast above-average monsoon rains for a second consecutive year in 2025, which will boost production. Global rice output is expected to reach a record 543.6 million metric tons in 2024/25, up from 535.4 million tons the previous year, according to estimates from the Food and Agriculture Organization. Total global supply, including stocks, is seen at 743 million tons, well above demand that is expected to rise to 539.4 million tons, the FAO estimates. In India alone, rice stocks, including unmilled rice paddy, in government warehouses totalled 63.09 million tons on April 1, nearly five times a government target of 13.6 million tons. With massive stocks and the expected rebound in production, buyers are in no rush to make purchases, while sellers are competing for market share - keeping global prices under pressure, said Agrawal. The Rice Exporters Association expects shipments from India to rise by nearly 25 per cent from a year earlier to a record 22.5 million metric tons this year. Olam Agri India, one of the world's top rice exporters, is even more bullish, projecting exports could climb to as much as 24 million tons. The jump is likely to propel India back to its dominant share of the global market, which stood at more than 40 per cent before it curbed exports in 2022, surpassing the combined sales of the next four largest suppliers - Thailand, Vietnam, Pakistan, and the United States. "India has already started to reclaim its lost market share," said Nitin Gupta, senior vice president at Olam Agri India. RUPEE REBOUND, STATE DEMAND CREATE A FLOOR When India's broken rice came back to the market in March, demand was stoked by a weak rupee, trading around 87.2 against the dollar, which helped to drive prices down. However, the rupee has since recovered to 84.55 against the dollar, and other exporting nations' currencies have strengthened, too, which has prevented global rice prices from falling further, three grain dealers said. Further providing a floor, Indian farmers have the option to sell paddy to the government. If exporters begin offering lower prices than the state-fixed price, farmers will start selling to the government. The government raises its minimum support price annually, another factor that will keep export prices from dropping further. RATTLED RIVALS Forecasts of higher supplies from India have rattled rival suppliers. In the first quarter of 2025, Thailand's rice exports fell 30 per cent to 2.1 million tons, as India offered the staple at lower prices prompting buyers to switch, said Chookiat Ophaswongse, honorary president of the Thai Rice Exporters Association. For 2025, Thailand's exports are likely to drop 24 per cent from a year ago to 7.5 million tons, while Vietnam's are expected to fall 17 per cent, also to 7.5 million tons, trade bodies in the two countries estimate. A 30 per cent year-on-year slide in rice paddy prices in Thailand in February sparked protests by farmers and prompted the government to offer a subsidy to rice growers. In an effort to support its farmers, Thailand has sought cooperation from India and Vietnam to address falling rice prices, the Thai commerce minister said in March. Benefiting from the price slump are the top rice-importing countries - the Philippines, Indonesia, Saudi Arabia, and African countries such as Senegal, Nigeria, and Ghana. In Ivory Coast, rice demand has grown with an influx of people from neighbouring countries, said Yacouba Dembele, director of the Agency for the Development of the Rice Sector. "India's export curbs were a bonanza for other Asian suppliers in the past two years. Now, the resumption in exports would make buyers happy with the moderation in prices," said Rao at the Rice Exporters Association.
