Basmati prices rise by 10%

The country's major basmati rice producers have increased the prices of the commodity by an average 10 per cent because of rising crop prices.

Earlier, companies such as KRBL (owner of India Gate brand), Kohinoor Foods (owner of Kohinoor) and LT Overseas (owner of Daawat) among others hiked the basmati prices by an average 15-20 per cent in November last year owing to higher paddy prices.

"We have hiked prices by 10-15 per cent across all the basmati category. As there is a shortage of paddy, there is scope for further increase," said Anup Mittal, joint managing director of KRBL, the country's largest basmati rice producer.

"Price of traditional basmati crop has risen up to Rs 2,350 a quintal from Rs 1,600 in November last year while Pusa paddy has jumped from Rs 1,200 to Rs 1,770 in the same period," said Anil Mittal, chairman and managing director of KRBL.

He added while farmers shifted from basmati crop to sugarcane last year, this year higher sowing of paddy was expected as the farm income had improved in the previous year, said Mittal.

"No one expected the prices to rise to these levels. But, with severe shortage of crop, we were left with no options. Consumers are likely to shift to low-end brands due to the price hike. Buyers of traditional basmati could shift to Pusa basmati and so on," said N C Gupta, vice president of LT Overseas, which raised the prices by 10 per cent.

The ex-factory price of the top-end basmati rice is currently at Rs 50 a kg. This is for the first time in the last 6-7 years that prices have reached these levels, said Gupta.

"Earlier in the season, the companies may not have fully factored the higher cost of paddy. Therefore, the price hike has come at intervals", said R S Seshadri, director of Tilda Riceland, which recently launched its Resham and Wandaful brands in Delhi. The company has hiked prices by 8-9 per cent this month.

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ANOTHER HIKE

The price of traditional basmati crop has gone up to Rs 2,350 a quintal from Rs 1,600 in November last year while Pusa paddy has jumped from Rs 1,200 to Rs 1,770

The ex-factory price of the top-end basmati rice is at Rs 50 a kg

This is for the first time in the last 6-7 years that prices have reached these levels

Consumers are likely to shift to low-end brands due to the price rise