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Saudi Arabia Halts Basmati Rice Imports From India, Exporters Urge Govt Intervention

JUL 31, 2018 (BE2C2): India’s Basmati Rice exporters have urged its federal government to initiate steps to resume export to Saudi Arabia which halted Rice imports from India since June for non-compliance with its new maximum level of pesticide residues in food items.

Exporters warn that the development will significantly shrink India’s share in the global rice market. India is the largest exporter of basmati, shipping 4 million tons of basmati in 2017-18 globally. The Kingdom’s rice import from India top the list with market share exceeding 77 percent in 2016/2017.

Rice export to the kingdom halted in India since June after a consignment was tested positively for not fulfilling the new criteria for residue detection — considered a big dent in its rice export revenue specially from the kingdom where per capita rice consumption is estimated at about 43 kg/year — more than the global average, as rice is a staple food in the kingdom. Basmati is served at both lunch and dinner. The majority of Saudis include rice as a major part of their daily diet. Most of the 10 million expatriates living in Saudi Arabia (from the subcontinent and other Far East countries) are also large consumers of rice.

The Saudi move follows reports of European countries testing premium variety basmati rice imported from India with traces of cancer causing fungicide tricyclazole.

Since January, Norway, Sweden, England and Finland have rejected at least 30 containers of basmati rice from India.

The ban is expected to hit Saudi consumer market as it’s the largest importer of basmati from India, with 70% of the $2 billion consignment headed for it.

According to an estimate, the kingdom buys 7-8 lakh tons of Rice, primarily basmati, from India.

Following the development, Indian authorities are set to initiate dialogue with Saudi authorities to seek mellowing of maximum residue level (MRL) norms that are likely to hit exports of mainly rice, buffalo meat and few other food items from India.

“The matter is being taken up with Saudi Arabia as the new MRL are not based on scientific facts and are too stringent to be fulfilled,” a senior official from Agricultural and Processed Food Products Export Development Authority (APEDA) said.

Meanwhile, the rice exporters association has started a campaign and reached out to basmati growers in four districts of Indian Punjab not to use the lethal fungicide. These are Amritsar, Tarn Taran, Gurdaspur, Ferozpur and Pathankot.

Exporters have also approached the Indian ambassador in Riyadh, the Saudi Arabian capital, to request the Saudi Food & Drug Authority (SFDA) not to go ahead with its notification on cutting the use of fungicide and defer its implementation, until a mutually agreeable solution is arrived at, the Hindustan Times reported.

Total rice consumption in Saudi Arabia is expected to reach 1.40 million in 2017/18. Demand for rice is expected to grow after MY 2017/18 due to population growth of 2.7 percent, improvement in the Kingdom’s economic situation, and an increase in foreign visitors to Mecca to perform the hajjand umrah rituals. In recent years, the total number of visitors who came to Saudi Arabia to perform hajj and umrah has been close to eight million
people. Fifteen million Hajj and Umrah visitors are expected annually by the end of MY 2019/20.






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