by TINTSWALO BALOYI
JOHANNESBURG, (CAJ News) – INDIA’S decision to ban exports of rice is forecast to add to rising risks to global food prices.
This, coinciding with the non-renewal of the Black Sea Grain Deal, will likely escalate the prices.
South Africa, the continent’s most diversified economy, is projected to bear the brunt.
India officially announced a ban on rice exports last week but this does not cover all rice categories.
It is mainly on the non-basmati white and broken rice.
“Still, this affected category is significant,” said agro economist Wandile Sihlobo.
He noted this accounted for 45 percent of the 22 million tonnes of rice that India exports to the global market annually.
India’s government is reportedly worried about inflation ahead of the elections, set for early 2024.
“However, the problem with this view is that India faces far less inflation pressure than other regions,” Sihlobo, based in South Africa, said.
According to Sihlobo, in June 2023, India’s annual consumer inflation was at 4,8 percent, down significantly from the start of the year when inflation was at 6,5.
Food inflation has moderated at roughly the same pace, measured at 4,5 percent in June 2023, down from 5,9 percent in January.
Sihlobo noted India’s ban on rice exports was understandably worrisome among people, because India is a significant producer of rice globally.
The country accounts for a 26 percent share in the expected 2023/24 global rice production of 525 million tonnes, according to data from the International Grains Council (IGC).
Of the 50 million tonnes of rice for global exports projected for the 2023/24 season, India is expected to account for about 40 percent.
South Africa is the world’s eleventh largest rice importer, with a typical import volume of about 1 million tonnes a calendar year.
The International Grains Council forecasts South Africa’s rice imports at 1,1 million in 2023 and a similar volume for the next year.
A majority, 90 percent, is for the domestic market.
India is second behind Thailand as the leading rice supplier to South Africa.
Other rice suppliers to South Africa include Australia, Brazil, China, Pakistan, United Sates and Vietnam.
– CAJ News