Rice prices climb on lower rabi acreage

In north India, price is up 28% since Nov 2016 despite higher output estimates this kharif season

Rice prices have started rising since January due to low rabi planting and reports of quality deterioration in the kharif crop. 

The food ministry estimates rice is 4.3 per cent costlier in the Delhi mandi since demonetisation. Quoted at Rs 2,400 a quintal, the fair average quality rice slumped to Rs 2,350 a quintal in Delhi by the end of December but recovered to trade at Rs 2,450 a quintal on January 25.

In north India, the price of rice has risen by up to 28 per cent since November despite higher kharif output estimates.

“Speculators have increased their control over the rice market. It is good that farmers are receiving a higher price,” said Ajay Vir Jakhar, chairman, Bharat Krishak Samaj. 

The agriculture ministry in its first advance estimates forecast the country’s kharif rice output at 93.88 million tonnes, 2.81 per cent higher than the 91.31 million tonnes of the previous year’s season.

Rice prices are firm across the country with the Sugandha Sella variety on Friday quoting at Rs 4,350 a quintal in Bundi, Rajasthan, up five per cent from Rs 4,130 a quintal a month ago. The Shriram variety of rice in Nagpur is also quoting three per cent higher in one month at Rs 5,130 a quintal.

“Domestic and export demand are keeping prices steady. Rabi sowing of rice has declined and this will keep prices firm,” said Rajiv Tevtiya, managing director, RML AgTech, an agricultural advisory firm.

The agriculture ministry reckons area under rice this rabi season is 14 per cent lower at 1.94 million hectares. The rabi crop contributes 15 per cent of India’s rice output.

Export prices are also firm with the five per cent broken parboiled rice quoted at $346-$350 per tonne this week, up from $341-$345 last Wednesday.  Demand from Africa has also improved recently. India exports non-basmati rice to Africa and basmati rice to West Asia. 

Basmati rice prices have started increasing after Iran recently allowed imports from India. Increase in basmati prices would push up prices of other varieties, Tevtiya said.