Indian export curbs on parboiled and basmati rattle the world rice market
rice market.
The world’s top shipper has placed restrictions on all of its exports, panicking governments from Asia to West Africa. Other big growers have tried to reassure consumers that rice supply is ample, but it’s done little to calm the market.
Rice prices in Asia jumped back near the highest level in almost 15 years on Wednesday after India slapped more curbs on parboiled and basmati over the previous weekend.
They were the last remaining varieties free from export restrictions, bringing to a head a recent campaign of tightening that started with a July 20 ban on the shipment of some grains.
“Spikes in rice prices always hurt poor consumers the most,” said Peter Timmer, Professor Emeritus at Harvard University, who’s studied food security for decades. “The most pressing concern right now is whether Thailand and Vietnam follow India and put significant controls on their rice exports.
If that happens, we will see world rice prices zoom past $1,000.”
The anxiety over supply is understandable. Rice is vital to the diets of billions and contributes as much as 60% of the total calorie intake for people in parts of Southeast Asia and Africa.
The benchmark price is currently at $646 a ton and weather could shake up the market even further.
The onset of El Niño this year threatens to parch many key growing regions across Asia, with Thailand already warning of drought conditions in early 2024. The crop in China, the world’s biggest producer and importer, appears to have escaped poor weather so far, but India’s major growing areas need more rain.
India’s measures boil down to politics.
