Impact of Covid-19 on Basmati Rice Exports

Introduction to Indian Basmati Rice:

Basmati Rice is a major Kharif crop that grows on every continent except Antarctica. For hundreds of years, it is the most common staple food for millions of people. More than 3.5 billion of the world population receives 20% of daily food calories from rice only.

This long-grained cereal belongs to the “Grass Family” and is majorly cultivated on the banks of the river as it needs more water to grow compared to other crops.  In the short span, rice exportation and cultivation would be profitable if cultivated under proper guidance and the right irrigation method.

Almost every country in the world exports Rice, but India is the largest exporter of rice. With exports of approximately 17.71 million tons of rice in 2020 -21, the rice export witnessed an increase of 86% as compared to the previous year.

There are approx. 6000 varieties of Rice that are cultivated in India like Basmati, Parboiled, long-grained, jasmine, red rice, etc. It is hard to believe that over the span of the last 40 years Indian rice market has lost 1.10 lakh of traditional rice species.

Impact of Covid-19 on Indian Rice Export

In the year 2019, almost every sector is affected by the world pandemic – Covid-19. However, you will be surprised to know despite the corona pandemic, the Agri-Commodity sector has experienced an exponential high. During the period of Covid-19, rice exports from India not only retained their value in the International Trade sector but at the same time, they also achieved newer heights. However, Basmati rice varieties saw a bit of a downfall during a pandemic.

Basmati Rice Export Data:

In the last few decades, Rice exports from India worldwide and Indian rice exporters are constantly giving their best, helping India rice export business grow in the International market. From FY-2016 to FY-2021, the Indian rice export market witnessed various ups and downs. The following table data will give you information about Export Volumes in all those years:

Note- Data sourced from credible sources and figures are approximations only.

In FY-2016-17, India exports 3,312,295.95 MT Basmati rice. In FY 18-19 India seeks growth in basmati rice export, and export 3,785,156.24 MT Basmati rice as compared to FY 17-18 where India exports only 3,330,236.12 MT.

But in FY 2019, during Covid 19 and Lockdown, the rice export market of India drastically goes up, helping both the Indian government and buyers/sellers to survive. During the Pandemic 2019-2020, India exports 3,772,557.10 MT Basmati rice, which is the highest from the year 2015 -2020. Even in the pandemic FY 2020-21, India exports 3,732,168.98 MT Basmati rice.

Source: agriexchange.apeda.gov.in

Pandemic Effect on Agri-Commodities Market:

During the Covid-19 pandemic, even the agriculture sector is badly affected. It is not that rice exporters are left unhampered in this pandemic; they also faced the same heat. The only difference who survived this pandemic compared to those who lost everything is “DIGITAL PRESENCE”. Businesses with their dependency on physical presence in the market and neglected digital presence faced huge losses or were badly affected, no matter for how long they play in the market. As compared to the above, the one who believes in buying and selling rice online through the B2B platforms, not only survives the pandemic situation, but some of them gained well in their Agri-export business.

Basmati Rice Trading Through B2B Platforms:

Trading online is not a cup of tea for everyone though; it could be convenient with the right platform. Numerous B2B platforms are offering different packages for the rice export business. However, the process in these platforms is time taking and involves plenty of paperwork. More than eight days are consumed in a simple online trading business, and you may end with fake leads as well.

To tackle such situations, some platforms offer buyers and sellers an opportunity to negotiate and close the deal in real-time that too within a fraction of hours. More interestingly, these platforms also facilitate complete trade without even a phone call or an email.