New Delhi: As India, Thailand, and Vietnam restrict rice exports, millions of consumers worldwide, particularly in Asian and African countries, are expected to bear the brunt, even as several countries are now turning to Mercosur members for supply of rice, which is already in short supply.
The recent Indian ban on the export of non-Basmati white rice poses a significant challenge. India, one of the world’s largest rice exporters, claims that it made this decision to help lower domestic rice prices and ensure domestic availability.
The United Arab Emirates, a major importer and re-exporter of Indian rice, followed suit, restricting its sale of rice to other countries. Meanwhile, Thai and Vietnamese exporters reacted by attempting to renegotiate the prices on sales contracts for approximately 500,000 tonnes of August shipments.
Thailand, another major rice exporter, has received less rainfall this year, prompting the government to encourage farmers to plant rice varieties that require less water and have shorter harvesting cycles in order to conserve water.
“The cumulative rainfall is approximately 40% below normal levels, posing a high risk of water shortage,” said Surasri Kidtimonton, secretary-general of Thailand’s National Water Administration, in a statement released on July 31.
The withdrawal of Russia from the Black Sea grain deal, which allowed for the safe export of Ukrainian grain via the Black Sea despite Moscow’s invasion of its neighbour, has had a significant impact on the global food market.
As a result, disruptions in the global rice trade could exacerbate the food security situation. Mercosur countries, which have received numerous requests for rice supplies, do not have many tonnes in stock. Brazil, one of South America’s largest economies, is reliant on rice imports from Uruguay, Argentina, and Paraguay.
Rice prices have risen dramatically, with a 14% increase since last June. Warmer, drier weather and erratic rainfall have harmed rice production throughout Asia, causing rice prices to skyrocket.
Last year, India exported approximately 22 million tonnes of rice to 140 countries, accounting for approximately 40% of global cereal trade. Thailand contributed about 15% of global market demand, while Vietnam contributed 14%.
Economically challenged countries like Bangladesh, Nepal, Senegal, Benin, and other parts of Sub-Saharan Africa rely heavily on non-Basmati rice imports from India, which will exacerbate food insecurity in many of these countries.
