Quote from Alex bobby on March 10, 2025, 4:21 AM

India Lifts Ban on 100% Broken Rice Exports Amid Record-High Stockpiles

In a major policy shift, India has lifted its ban on the export of 100% broken rice, allowing shipments to resume after more than a year of restrictions. The decision, announced late Friday by the Indian government, comes as the country’s rice stockpiles have soared to unprecedented levels, nearly nine times the government’s target at the start of February.

This move is expected to benefit not only India’s rice industry but also global markets, particularly in Africa and parts of Asia, where broken rice is a staple for human consumption and animal feed production.

Why India Banned Broken Rice Exports

India, the world’s largest rice exporter, first imposed restrictions on the export of 100% broken rice in September 2022. This was followed by additional curbs on other rice grades in 2023, as concerns over poor rainfall and declining production led to fears of domestic shortages and rising prices.

However, with the country harvesting a record rice crop, the government has gradually eased restrictions. Now, with surging stockpiles, policymakers have deemed it necessary to reintroduce exports of broken rice to balance supply and demand.

Impact on Global Markets

The lifting of the ban is expected to have far-reaching effects, particularly for African nations that rely heavily on broken rice as an affordable food source. Countries such as Senegal and Djibouti were among the largest importers of Indian broken rice before the ban.

B.V. Krishna Rao, president of the Rice Exporters' Association (REA), expects India to export around 2 million tons of broken rice in 2025. Before the restrictions, India had exported 3.9 million metric tons in 2022, mainly to China for animal feed and to African nations for direct consumption.

“Now that broken rice exports are allowed, we anticipate a significant revival in demand from our key buyers,” said Rao.

Competitive Pricing and Market Dynamics

Despite the lifting of the ban, Indian broken rice remains slightly more expensive than its competitors. Currently, Indian broken rice is priced at $330 per metric ton, compared to approximately $300 per ton from countries like Vietnam, Myanmar, and Pakistan.

However, industry experts believe India will regain its market share as rival suppliers run low on stocks. "These competing countries have limited stocks. As their stocks deplete, buyers will switch to India, and exports will pick up in the coming months," said Himanshu Agrawal, executive director at Satyam Balajee, one of India’s leading rice exporters.

India’s Surplus Rice Reserves

One of the main factors behind the decision to lift the ban is India’s massive rice reserves. As of February 1, state granaries held 67.6 million metric tons of rice, including unmilled paddy, according to data from the Food Corporation of India. This is drastically higher than the government’s target of 7.6 million metric tons, highlighting the need for export-friendly policies to prevent wastage and manage stock levels effectively.

The Road Ahead for Indian Rice Exports

With the export restrictions lifted, India is poised to regain its dominance in the global broken rice market. The move is expected to stabilise domestic rice prices, ensure efficient use of stockpiles, and provide relief to import-dependent nations.

As global demand picks up, India’s rice industry will need to navigate pricing challenges, logistics, and government policies to ensure a steady and sustainable flow of exports. However, with strong supply levels and returning market access, India is well-positioned to reclaim its role as the leading supplier of broken rice to the world.

Conclusion: A Strategic Move for India and Global Markets

India’s decision to lift the ban on 100% broken rice exports marks a significant shift in its trade policy, reflecting an improved domestic supply situation. With record-high stockpiles, the move helps stabilise the country’s rice reserves while meeting the growing global demand, particularly from Africa and Asia.

Although Indian broken rice is currently priced slightly higher than competitors, experts anticipate a surge in exports as rival suppliers run low on stocks. This policy change is not only expected to benefit Indian exporters but also provide a lifeline to nations that rely on affordable broken rice for food and animal feed production.

Looking ahead, India's rice industry must focus on maintaining its competitiveness, ensuring smooth trade logistics, and monitoring global demand shifts. With strong supply levels and renewed export opportunities, India is set to reassert its leadership in the global rice market, strengthening its role as a crucial supplier to food-insecure nations.