Rice stocks increases, new season supplies to bump up inventories

By Reuters

India’s October rice stocks piled up to 31.1 million metric tons, the highest for the month in the past two decades, thanks to a clutch of export curbs imposed last year by the world’s biggest grain exporter.The Food Corporation of India (FCI), the state stockpiler, is expected to buy 48.5 million metric tons of the new season summer-sown rice in the marketing year that began on Oct. 1, further bumping up inventories in chock-a-block government warehouses.

The Food Corporation of India bought 46.3 million metric tons of summer-sown rice from domestic farmers in 2023-24.

Farmers in India, the world’s second biggest rice producer, have just started harvesting the rice crop. Copious monsoon rains prompted growers to expand planting areas, likely leading to a bumper crop this year. India needs nearly 38 million metric tons of rice to distribute the grain for free to 800 million beneficiaries of the world’s biggest food welfare programme. Rice reserves in state granaries totalled 31.1 million metric tons at the start of this month, up from 22.2 million metric tons in October 2023, the Food Corporation of India said.

India late last month gave the go-ahead for exports of non-basmati white rice to resume, a move that would beef up overall global supplies and soften international prices by forcing other major exporters of the staple such as Pakistan, Thailand and Vietnam to reduce their rates.

New Delhi’s decision to allow traders to sell non-basmati white rice on the world market followed a series of moves to ease export restrictions on premium, aromatic basmati and parboiled varieties. India still doesn’t allow exports of 100% broken rice. As part of efforts to cut back rice inventories, India in August allowed distilleries to buy up to 2.3 million metric tons of the grain from the Food Corporation of India.

This article has been republished from The Business Standard