Rice exports from the Kakinada port have suffered a setback due to the outbreak of the Ebola virus in West Africa, and also due to stiff competition from countries like Pakistan and Thailand.
Almost 98 per cent of rice exports from the Kakinada port are bound for African countries. However, most European vessels are not showing any interest in going to the African countries because of the virus threat. In the past three months, only four vessels have left for the African destinations. The number should ideally have been nine.
Crew members do not want to take any risks as there is no global insurance coverage. The insurance companies are also not keen on extending coverage to the crew going to African nations. Therefore, the crew members are also demanding higher salaries and the overheads are increasing.
“The charges per tonne of rice export have gone up by 15 to 20 per cent. In terms of price, India is facing competition from Pakistan and Thailand’’, said, P. Srinivas, a rice exporter.
Meanwhile Shortage in TS rice adds to trouble
Rice exporters are worried as the paddy crop in the Telangana region has suffered extensive damage. Rice varieties like Swarna and others, which are grown in East and West Godavari districts, are largely for the domestic market. The varieties grown in Telangana are for the export market.
“Every year, traders buy 4-5 lakh tonnes rice from the Telangana region for export. This year, it will not be possible as the crops may not yield such huge quantities,” said P. Srinivas, a rice exporter.
To make matters worse, the Food Corporation of India has also changed its procurement policy. It used to procure 75 per cent levy and give permits for 25 per cent to be sold either in the domestic market or the global market. Now, it is only procuring 25 per cent. The rice millers are finding it difficult to provide rice to exporters at competitive prices due to the policy.