Global rice shortage looms as top exporter India’s supply woes worsen amid Red Sea attacks

Exports of premium Indian basmati rice last month were half of what they were a year ago, with traders blaming freight rates that have doubled following a series of attacks on commercial ships by Iran-backed Houthi militants.

Indian basmati prices currently sit at around US$950 to $1,800 per tonne, traders say.

Meanwhile, the price of exported parboiled rice – which is partially boiled in the husk before sale – from India skyrocketed to a record high of between US$533-US$542 per tonne this week on limited supplies and steady demand from Asian and African buyers.

Purchases from rice farmers by the state-run Food Corporation of India have hardly left any stocks for private traders, who say more supplies are likely to be kept at home to rein in domestic prices as the nation prepares to head to the polls later this year. Food inflation has historically been a key issue for voters in India.

India’s exports of non-basmati varieties are also being affected by the limited quantities available to private traders, as well as the long shipping times and more expensive freight costs to parts of Africa and other places, said Prem Garg, national president of the Indian Rice Exporters Federation.

High freight costs have also resulted in disputes as exporters push to negotiate their contracts with buyers.

“Old contracts with buyers are being disputed. Many people want to cancel their orders,” Garg said, adding that the cost of booking a single container on ships to Africa had tripled to US$4,000.

“India and Pakistan’s exports are more affected. Thailand and Vietnam exports are in a lull period and will pick up after Ramadan [expected to end on April 9],” said a Thailand-based rice trader who asked not to be identified.

Vietnam’s benchmark 5 per