Traders and analysts believe that India may face challenges in regaining the trust of global buyers of broken rice following the government’s decision to lift the ban on its exports on March 7.
“India is unlikely to reach the same level of broken rice exports as before the ban was imposed,” said exporter Rajesh Paharia Jain from New Delhi.
The ban on broken rice exports was imposed by the government in September 2022 due to concerns about food inflation and potential production issues following deficient rainfall in growing areas.
According to trade analyst S Chandrasekaran, the decision to allow broken rice exports was made as domestic prices of the grain had significantly decreased.
Currently, global rice prices are at a two-year low, and warehouses are overflowing with a record 36.7 million tonnes of rice stocks as of March 1, 2025.
However, Indian broken rice is priced higher than other origins such as Myanmar and Pakistan. Indian exporters are quoting $360 per tonne for broken rice. In comparison, Vietnam and Pakistan are offering 100% broken rice at $307 per tonne, while Thailand is quoting at $354.
During the 2021-22 fiscal year, India exported a record 17.26 million tonnes of non-basmati rice, with broken rice accounting for 3.89 million tonnes.
One of the main uses of broken rice is for ethanol manufacturing, which saw increased demand during the Covid pandemic. Ethanol distilleries in India prefer broken rice for conversion, especially considering the competitive pricing offered by the Food Corporation of India (FCI).
Despite the lifting of the ban, it may be challenging for India to regain its position in the broken rice market, especially with competition from other Asian countries. Lowering offer prices and targeting specific markets, such as Africa, may be necessary for Indian exporters to compete effectively.
Overall, broken rice exports are expected to be lower than the volumes seen in the past, with the demand for ethanol manufacturing being a key factor. The market dynamics are changing, and India will need to navigate these changes strategically to maintain its position in the global rice trade.
