India government to import 30,000 tonnes rice

India's government plans to import 30,000 tonnes of rice to offset an expected production shortfall following the worst monsoon in nearly four decades, a report said Saturday. The move comes as the US Department of Agriculture has forecast India's rice output will fall between 15 million and 17 million tonnes in the crop year from October 2009 to September 2010 following two years of bumper harvests.
India is the world's second-largest rice producer. The country of nearly 1.2 billion people produced a record 99.15 million tonnes of rice last year. The government has asked three state-owned trading firms, MMTC, STC and PEC, to import 10,000 tonnes of rice each and sell it in the market, the Press Trust of India said. "The tender to import rice is under the government instruction," Sanjiv Batra, chairman of MMTC, told the news agency.
An official of another publicly owned trading company STC said the rice shipments were likely to arrive in the country in November and December. As of now, the three state-run trading firms have been advised to import only 10,000 tonnes each, added the STC official, who was not identified. Earlier this week, the Press Trust of India reported private traders had already imported 400,000 tonnes of rice and the figure was expected to rise.
Some experts have said India could buy up to three million tonnes of rice on world markets. The government has waived customs duty on rice imports of 70 percent until September 2010. The forecast rice shortfall comes after India's driest monsoon since 1972, which affected most of the rice-sowing areas of the country and was followed by devastating floods.
This year, the government says the rice-sowing area has fallen by six million hectares (15 million acres) to 32.9 million hectares and the rice crop is expected to be reduced. Analysts say India could become a net purchaser of rice for the first time in two decades as a result of the bad weather. Rice prices in the domestic market have soared by 25 percent in the last four months on supply worries. India still has comfortable buffer stocks of 14.5 million tonnes, far above its buffer target of 5.2 million tonnes, according to local media reports.