With additional procurement of rabi and summer rice expected to continue in eastern and southern states, India’s rice procurement in market year 2016-17 is likely to touch a record 38 million tonnes, about 4 million tonnes higher than last year and 2 million tonnes higher than the previous record.
The USDA estimates India’s market year 2016-17 rice production at a record 108 million tonnes. Market year 2016-17 area is revised lower to 42.9 million hectares based on the revised official estimates from the Ministry of Agriculture. Consequently, market year 2016-17 rice yields are estimated at a record 2.51 tonnes per hectare. According to the USDA report, the normal 2016 monsoon supported timely planting, lower incidence of pest and diseases, and relatively lower harvest losses due to untimely rains at the time of harvest. The relatively higher share of high yielding non-Basmati rice compared to the long grain Basmati rice supported higher rice production in the north Indian states.
Indian rice exports have been strong since the beginning of calendar year 2017 on relatively strong demand for non-Basmati rice, mainly from African countries and neighboring Bangladesh.
According to preliminary official statistics, rice exports from October 2016 to March 2017 were estimated at 5.2 million tonnes compared to 4.8 million tonnes for the corresponding period last year, largely on strong resurgence in the demand for both Basmati and non-Basmati rice since December 2016. Assuming no significant changes in the price parity for Indian rice during the remaining marketing year, market year 2016-17 exports are likely to reach 11 million tonnes compared to 10.2 million tonnes in the previous year. However, any change in the import policy of the major destination country or in the value of the Indian rupee against the U.S. dollar may affect the export prospects in the second half of the marketing year. Market year 2017-18 rice exports are forecast at 10 million tonnes on sufficient domestic supplies, assuming continued export demand and international price parity for Indian rice.