Following the wheat export ban in May, India now bans the export of broken rice and imposes a 20% tariff on the export of unpolished rice, brown rice with shell, semi-polished and fully-polished rice from 9 September.
India’s move could trigger a new surge in global grain prices and exacerbate the global food crisis when the Black Sea “food corridor” reopens and the global food crisis eases slightly.
India is the world’s second largest rice producer and the largest rice exporter, shipping rice to over 150 countries. However, this year’s extremely dry weather has led to a sharp decline in rice acreage, fueling rising rice prices and inflation in the country. Export restrictions will help India secure domestic rice supplies and keep prices down, but will put further inflationary pressure on countries that rely heavily on Indian rice imports.
China is India’s biggest buyer of broken rice, but India’s export ban will have a negligible impact on China. China’s rice self-sufficiency rate exceeds 100%, and its imports are mainly to meet diversifying domestic needs. In 2021, China imported her 4.96 million tons of rice, which is only about 3% of rice production. China also imports rice from Vietnam, Pakistan, Myanmar, Thailand and other countries, enhancing its ability to prevent risks.
Affected by the Russian-Ukrainian conflict and global wheat and corn price volatility, China has reduced corn and wheat imports this year, but increased rice imports, especially broken rice for feed and alcohol production. India’s export ban has had some impact on Chinese feed and industrial companies, but minimal impact on food distribution.
Compared to the sharp volatility of world corn and wheat prices over the past two years, the volatility of global rice prices has decreased. Global rice prices have risen in recent months. Thailand and Vietnam agreed to raise rice prices in her late August.
Rising rice prices are likely to become the new focus of the global grain market in the second half of the year. In the face of rising rice prices, grain-exporting countries will abandon food trade protectionism, developed countries will help developing countries to improve their food self-reliance capacity, and joint efforts will be made for efficient, open and fair development.
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Source: China Daily
