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Domestic rice prices ‘may continue to rise’: Food Ministry

Prime News, National, Food Grains, Finance, New Delhi, September 23:- Domestic rice prices are showing an upward trend and it “may continue to increase” due to low kharif production forecast and 11 percent jump in the export of non-basmati rice, the Food Ministry said Thursday (September 22).

The statement was made in the fact sheet that the ministry issued detailing the reasoning behind recent amendments to India’s rice export policy.

The ministry also said that the recent changes in India’s rice export rules “have helped keep a check on domestic prices” without reducing the availability for exports.

Early this month, the government had banned export of broken rice and imposed a 20 percent export duty on non-basmati rice to boost domestic supplies paddy crop acreage in this kharif season.

In its fact sheet, the Food Ministry said: “The domestic prices of rice are showing an increasing trend and it may continue to increase due to low production forecast by about 6 million tonnes of paddy and 11 percent increase in export of non-basmati rice compared to the corresponding period of last year.”

The retail price of rice showed an increase of 0.24 percent over the week, 2.46 percent over the month and 8.67 percent over the year as on September 19. There is an increase of 15.14 percent on an average of five years, it said.

Domestic broken rice price, which was ₹ 16 per kg in the open market, has increased to about ₹ 22 per kg in States, it added.

Poultry and animal husbandry farmers were impacted the most due to price hikes in feed ingredients, the ministry said, adding it is because about 60-65 percent inputs cost for poultry feed comes from broken rice.

“Any increase in prices of feedstock are reflected in price of poultry products like milk, egg, meat, etc., adding to food inflation,” it noted.

According to the ministry, the international price of Indian non-basmati rice is selling around ₹ 28-29 per kilogram, which is higher than the domestic price. Export duty of 20 percent on non-basmati rice would lead to a lowering in rice prices.

The ministry said domestic rice production is estimated to decline by 6 percent to 104.99 million tonnes in the 2002-23 kharif season.

The ministry further said the ban on export of broken rice, which is used in poultry feed, was imposed following a rise in the grain’s exports in recent months, which had put pressure on the domestic market.

“This is a temporary measure which has been undertaken for food security concerns of the country keeping in line with the achievement of SDGs (Sustainable Development Goals).” The changes have been done keeping in mind the need to support the ethanol-blending programme that saves costly oil imports, and to help the animal husbandry and poultry sectors by reducing the cost of animal feed that has a bearing on the price of milk, meat and eggs, it said.

There has been a rise in global demand for broken rice due to geo-political scenario which has impacted the price movement of commodities including those related to animal feed. (MR, Inputs: Agencies)

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