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Restriction on India’s Rice Exports Elevates World Rice Price Index to Almost 12-Year Peak in July, Reports FAO

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India Rice Export Ban, In July, the Food and Agriculture Organization of the United Nations (FAO) reported a 2.8 percent increase in the FAO All Rice Price Index compared to the previous month, reaching an average of 129.7 points.

Rice Prices Soar to Nearly 12-Year High Amidst Multiple Contributing Factors

India Rice Export Ban, Rice prices have experienced a substantial surge in recent months, attaining levels not seen in almost 12 years. According to the Food and Agriculture Organization of the United Nations (FAO), the FAO All Rice Price Index saw a notable 2.8 percent upswing in July compared to the preceding month, reaching an average of 129.7 points. This figure is almost 20 percent higher than the same period last year and represents the highest point since September 2011, as reported by Reuters.

Several factors have converged to propel the upward trajectory of rice prices. Robust demand for rice is among the driving forces. Additionally, India’s recent imposition of restrictions on exports has diminished the global rice supply. Furthermore, erratic weather conditions in certain rice-producing nations have resulted in reduced yields, further tightening the supply chain.

India Rice Export Ban Adds to Global Food Price Concerns

An important observation is that India, responsible for 40 percent of global rice exports, took the step last month to suspend its primary rice export category in an effort to stabilize domestic prices, which had surged to multi-year peaks in recent weeks.

Within the prevailing circumstances, such constraints are anticipated to intensify fluctuations in food prices worldwide. Pierre-Olivier Gourinchas, Chief Economist at the IMF, pointed out in a press briefing that these actions could potentially trigger retaliatory measures as well.

Impending Concerns India Rice Export Ban and Its Impact on Global Food Security

The escalating cost of rice is poised to wield a substantial influence on the food security status of numerous nations. With rice serving as a fundamental dietary staple for millions worldwide, the mounting prices could potentially create challenges for individuals striving to afford this essential sustenance.

As outlined in the report, prominent rice exporters encompass India, Thailand, Vietnam, Cambodia, and Pakistan. Conversely, China, the Philippines, Benin, Senegal, Nigeria, and Malaysia emerge as vital importers of this staple grain.

India’s non-basmati white rice exports, for instance, surged from USD 2.62 million in the previous year to USD 4.2 million in the 2022-23 period. The United States, Thailand, Italy, Spain, and Sri Lanka stand as key destinations for India’s non-basmati white rice exports.

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