Rising prices have hit export of Basmati rice this year. Exports in 2006-07 are likely to be at a three-year low following the rise in prices.

Basmati exports were 7.6 per cent down at 8.44 lakh tonnes between April and January in 2006-07 from 914,000 tonnes exported in the corresponding period of 2005-06. In terms of value, exports declined by 8.6 per cent from Rs 2,422 crore (Rs 24.22 billion) to Rs 2,213 crore (Rs 22.13 billion).

Total Basmati exports in 2005-06 were 11.66 lakh tonnes, valued at Rs 3,043 crore (Rs 30.43 billion), while they were 11.62 lakh tonnes at Rs 2,823 crore (Rs 28.23 billion) in 2004-05.

Prices of Basmati went up from October onwards, owing to a shortage in production and this is the main reason behind the fall in volume of exports. Final export figures may see a decline by 4-5 per cent.

However, no fresh contracts are being done at current prices. Exporters are also facing problems, owing to the strengthening of the rupee against the dollar. The export price of India Gate Classic brand is $1200 a tonne this year against $950 last year. Farmers have made good money in the last season and therefore the sowing of Basmati paddy was expected to be better than the last year's, which would lead to a higher output.