' We don't export grains. '
India's Grain Export Ban, what's going to happen now?
The Indian government extends export restrictions on wheat and rice.
India is a major agricultural exporter and plays a significant role in the global market. Recently, the nation has faced crop disruptions caused by extreme weather events, couple with the logistical and supply chain challenges arising from the Russia-Ukraine conflict. These factors have led to a dramatic increase in the prices of agricultural commodities. In an attempt to stabilize the domestic market, the Indian government has implemented a ban on wheat and rice exports.
Previously, the Indian government had imposed the following restrictions:
• May 2022: Ban on wheat exports
• September 2022: Ban on broken rice exports and imposition of export taxes on non-Basmati white rice
• July 2023: Complete ban on white rice exports
India is expected to end the fiscal year 2022-23 with a total of US$760-770 billion worth exports, an improvement over the FY 2022 figure of US$676 billion. This was achieved despite various global headwinds that have disrupted supply chains, slowed export demand, and put pressure on trade shipments.
Impact of India's agricultural export ban on the global trade market
from the perspective of packers and buyers.
Packers:
Reduced exports: As a major grain exporter, India's export ban reduced packers' export opportunities.
Increased inventory: Decreased exports led to increased inventory, raising management costs.
Increased price volatility: Grain supply uncertainties increased prices and impacted packers' profitability.
Exploring new markets: Packers were forced to explore new markets or focus on the domestic market.
Buyers:
Reduced supply: India's export ban made it difficult for buyers to procure desired grains.
Increased prices: Buyers faced significantly higher grain prices due to reduced global grain supply.
Increased uncertainty: Policy uncertainty made it difficult for buyers to plan their business operations.
Securing alternative sources: Buyers were forced to secure grains from other countries.
Impact on agricultural prices:
Grain prices: Prices of major grains such as rice, wheat, and pulses increased significantly worldwide.
Food prices: Grain price increases led to higher food prices.
Increased price volatility: Global grain supply uncertainties increased grain price volatility.
Food insecurity: Rising food prices exacerbated food insecurity in low-income and food import-dependent countries.
Forecasting the future: Will agricultural export restrictions persist?
According to global media outlets such as Reuters, Financial Times, and local Indian media like Economic Times, experts predict that the Indian government's agricultural export restrictions will likely continue until 2024.
Ashok Gulati, an agricultural economist and government policy advisor, stated that controlling domestic inflation is a key priority for the Indian government and that export restrictions are likely to remain in place until the 2024 elections.
Gulati emphasized that domestic politics has always taken precedence over economic or international considerations in India.
"Image source: KITA (Korea International Trade Association) - [https://www.kita.net/board/totalTradeNews/totalTradeNewsDetail.do?no=%2078252&siteId=1]
Korean buyers are looking for suppliers to replace Indian grains.
If you are a packer looking for alternative countries with stable exports due to disruptions or instability in trade with India, please contact us. We have a network of over 600 buyers actively seeking suppliers with experience trading with India.
' We don't export grains. '
India's Grain Export Ban, what's going to happen now?
The Indian government extends export restrictions on wheat and rice.
India is a major agricultural exporter and plays a significant role in the global market. Recently, the nation has faced crop disruptions caused by extreme weather events, couple with the logistical and supply chain challenges arising from the Russia-Ukraine conflict. These factors have led to a dramatic increase in the prices of agricultural commodities. In an attempt to stabilize the domestic market, the Indian government has implemented a ban on wheat and rice exports.
Previously, the Indian government had imposed the following restrictions:
• May 2022: Ban on wheat exports
• September 2022: Ban on broken rice exports and imposition of export taxes on non-Basmati white rice
• July 2023: Complete ban on white rice exports
India is expected to end the fiscal year 2022-23 with a total of US$760-770 billion worth exports, an improvement over the FY 2022 figure of US$676 billion. This was achieved despite various global headwinds that have disrupted supply chains, slowed export demand, and put pressure on trade shipments.
Impact of India's agricultural export ban on the global trade market
from the perspective of packers and buyers.
Packers:
Reduced exports: As a major grain exporter, India's export ban reduced packers' export opportunities.
Increased inventory: Decreased exports led to increased inventory, raising management costs.
Increased price volatility: Grain supply uncertainties increased prices and impacted packers' profitability.
Exploring new markets: Packers were forced to explore new markets or focus on the domestic market.
Buyers:
Reduced supply: India's export ban made it difficult for buyers to procure desired grains.
Increased prices: Buyers faced significantly higher grain prices due to reduced global grain supply.
Increased uncertainty: Policy uncertainty made it difficult for buyers to plan their business operations.
Securing alternative sources: Buyers were forced to secure grains from other countries.
Impact on agricultural prices:
Grain prices: Prices of major grains such as rice, wheat, and pulses increased significantly worldwide.
Food prices: Grain price increases led to higher food prices.
Increased price volatility: Global grain supply uncertainties increased grain price volatility.
Food insecurity: Rising food prices exacerbated food insecurity in low-income and food import-dependent countries.
Forecasting the future: Will agricultural export restrictions persist?
According to global media outlets such as Reuters, Financial Times, and local Indian media like Economic Times, experts predict that the Indian government's agricultural export restrictions will likely continue until 2024.
Ashok Gulati, an agricultural economist and government policy advisor, stated that controlling domestic inflation is a key priority for the Indian government and that export restrictions are likely to remain in place until the 2024 elections.
Gulati emphasized that domestic politics has always taken precedence over economic or international considerations in India.
"Image source: KITA (Korea International Trade Association) - [https://www.kita.net/board/totalTradeNews/totalTradeNewsDetail.do?no=%2078252&siteId=1]
Korean buyers are looking for suppliers to replace Indian grains.
If you are a packer looking for alternative countries with stable exports due to disruptions or instability in trade with India, please contact us. We have a network of over 600 buyers actively seeking suppliers with experience trading with India.