Govt bans EXPORT of broken rice from today; here's WHY

India banned the export of broken rice with immediate effect. The export policy has been revised from "free" to "prohibited". Broken rice is widely used as feed in the poultry sector.

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New Delhi: An abnormal rise in exports and lower availability of broken rice in domestic markets pushed the central government to put a ban on its trade, said Sudhanshu Pandey, Secretary, Department of Food and Public Distribution. Talking to reporters on Friday, Pandey said the price of broken rice which was around Rs 15-16 (per kg) increased to Rs 22 and its overall exports rose 3 times.

As a result, broken rice was neither available for poultry feed nor for the manufacturing of ethanol. Broken rice is widely used as feed in the poultry sector. "The contribution of the feed is about 60 per cent as cost on input to the poultry sector. So the prices will get pushed," Pandey said.

India banned the export of broken rice with immediate effect. The export policy has been revised from "free" to "prohibited". Some exports will, though, be allowed till September 15, including for where loading of broken rice on the ship has commenced before this ban order, where the shipping bill is filed and vessels have already berthed or arrived and anchored in Indian ports and their rotation number has been allocated, and where broken rice consignment has been handed over to the customs and is registered in their system.

Also, on Thursday, the Centre imposed a 20 % export duty on non-Basmati rice, except for parboiled rice, to boost domestic supplies. The ban on exports and imposition of export tax assumes significance as it appears that the overall sown area under paddy this Kharif season could be lower than that of last year. This can have an impact on both crop prospects as well as prices going forward.

This Kharif season, the area under paddy cultivation is around 6 per cent lower than the previous season at 383.99 lakh hectares. Kharif crops are mostly sown during monsoon -June and July, and the produce is harvested during October and November. The primary reason for the decline in the sown area could be attributed to the slow advancement of the monsoon in the month of June and its uneven spread in July in some growing key regions in the country.

Crop diversification could possibly be another reason. Secretary Pandey said India`s Kharif rice production, in the worst-case scenario, could fall by 10-12 million tonnes.