India's ban on rice exports prompted retailers in the UAE to anticipate an initial 40 per cent price surge for the commodity. It is a temporary issue and will be resolved soon once the new suppliers enter the market, the UAE retailers said on Tuesday.

Vietnam, Thailand and Pakistan would fill the supply gap of non-basmati rice following India’s export ban due to production shortfall.

India was one of the largest rice exporters, accounting for more than 40 per cent of rice exports, amounting to 55.4 million metric tons last year. India is also one of the major sources of rice imports for the UAE importers.

“India is a major supplier of non-basmati rice to the UAE, and the ban on exports will lead to a reduction in the availability of rice in the market. This could lead to higher prices for rice, as well as supply constraints for businesses that rely on rice as a key ingredient. This could lead to increased reliance on other countries, such as Thailand, Vietnam, and Pakistan,” said Kamal Vachani, group director and partner at Al Maya Group.

“This is only a temporary move as the prices will stabilise and the situation will normalise soon as and when the new seasons start, and supply will be back to normal,” said Vachani.

Dr. Dhananjay Datar, chairman and managing director, Al Adil Trading, said many varieties of non-basmati rice were being imported into the UAE before India decided to ban exports due to lower crops pushing up prices in the local market.

Dr Datar added that alternative markets are Thailand, Vietnam and Pakistan, also among the biggest rice producers.

“Non-basmati rice accounts for around 45 per cent of the local consumption, mostly consumed by the South Indians,” he said, adding that prices could rise by 40 per cent.

As a result, he added, that demand for basmati rice could also see a surge as residents shift to the costlier staple food.

 

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