According to Nitin Gupta, vice-president of rice operations at Olam India, India could account for 45% of the global rice trade by 2021. Indeed, the increase in port capacity should enable India to become the world's second largest rice producer, behind China. This will enable it to send record volumes to Africa and Asia, the two main destinations for Indian rice.

In 2020, India's exports rose 49% to a record 14.7 million tonnes (Mt), with non-basmati rice shipments jumping 77% to a record 9.7 million tonnes (Mt). And this year, its international sales of non-basmati rice could almost double from last year to 18 million tonnes. India's rice exports of all varieties would amount to 48.5 million tonnes in 2021/22, according to the US Department of Agriculture (USDA).

However, India's traditional buyers, China, Vietnam and Bangladesh have joined the ranks of its customers. In fact, since March, Indian rice has remained very competitive with Thai and Vietnamese origins, according to reports. However, the country could not benefit immediately because India's main rice port, the Kakinada anchorage, was continuously congested and experienced significant delays in loading vessels. According to exporter Brahmananda Gudimetla's explanation, India was offering its rice at a discount of up to US$100 per tonne compared to other origins, but the costs of the delays negated this comparative price advantage.

In response, the southern Indian state of Andhra Pradesh decided in February to use a deep-water port near Kakinada for rice shipments. This has reduced the waiting time for loading ships.

However, this does not completely solve the problem as Kakinada does not have an efficient infrastructure for loading rice. According to one information source, in Kakinada it takes about a month to load 33,000 tonnes of rice. In Thailand, it takes only 11 days for the same amount. Kakinada has felt this lack of competitiveness even more strongly with the increase in freight rates, as this has pushed rice transporters to switch from containers to bulk.  If Kakinada's infrastructure were improved, the port could handle an additional 2 million tonnes of rice.

According to provisional data from the Ministry of Commerce, in the first seven months of 2021, India shipped 12.84 million tonnes of rice, an increase of 65% over the same period last year. In 2021, according to Muralidhar, chief operating officer of Kakinada Seaports Ltd, about one million tonnes of rice could be shipped from Kakinada.

Santie

Photo Credit : Passeport Santé

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