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Prices, new markets to spur Indian rice exports

India's rice exports are expected to surge in coming months because of its globally competitive prices and growing demand from new markets, traders said on Friday.

"The market is very bullish. We are cheaper than Thailand and Vietnamese rice varieties," said S S Kumar, vice-president of L T Overseas, a leading exporter.

Thai rice prices have surged over the past week. Vietnam's rice trade has been idle in the past week as indicative prices were too high and exporters did not offer grain.

Competition among Thailand, the world's top exporter, Vietnam and India to capture new markets has sharpened in recent months.

Kumar said Iran was emerging as a new market for India, in addition to traditional buyers such as Indonesia, the Philippines and Nigeria, because of the competitive prices and good quality of rice offered.

"We are grabbing the Thailand and Vietnam markets," said a leading New Delhi exporter.

Traders said India had sold about 50,000 tonnes of rice to Iran in the past few months and shipments were now on their way to the Middle East country.

"We are expecting good repeat orders from Iran which wants good quality double polished rice," said another trader.

Kumar said since December, India had exported about two million tonnes of rice and was expected to sell about 3.5 million tonnes by the close of the year.

"Several Indian companies are doing well and in calendar 2003 we should be exporting about 5.0 million tonnes if the government does not change its policies," Kumar said.

The country shipped around 1.7 million tonnes of rice in 2001 after it reduced its export price to trim bulging stocks.

Traders said Indian exporters had lifted about half a million tonnes of rice from the granaries of the state-run Food Corporation of India in recent weeks on expectations of good export orders.

"The rice market is bullish but we are worried about logistical problems, moving the rice to ports from the rice-growing states of Punjab and Haryana," said Atul Chaturvedi of Adani exports.

Chaturvedi said huge amounts had been sold for shipment in May, June and July to Africa, Indonesia and the Philippines. "The monsoon is going to add fuel to the fire."

India's southwest monsoon is expected to set in over the southern Kerala state in the first week of June and cover the rest of the country over the next four months.

Helped by good rains, India is likely to produce 89 to 90 million tonnes of rice in the 2002 crop year to June, compared with 86.3 million a year ago.

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