Farm exports could take $4-5 billion hit in FY24 due to curbs on wheat, rice, sugar

Cost of shipping basmati could go up affecting prices if Houthi attacks on Red Sea continue [View in browser]( [See all newsletters]( 22 December 2023 Farm exports could take $4-5 billion hit in FY24 due to curbs on wheat, rice, sugar [Basmati rice exports are now the biggest commodity in India’s farm export basket with exports of the premium variety touching $3 billion till October this year] India’s agriculture exports could take a hit of about $4-5 billion this fiscal due to curbs on wheat, non-basmati rice and sugar. But, the government is hopeful that last year’s export level would be maintained owing to rise in shipments of items such as basmati, fruits and vegetables, meat and dairy, and cereal preparation, officials familiar with the matter said. Additionally, basmati rice exports may get affected by the Houthi rebel attacks on the Red Sea, although there is no immediate impact, as costs could go up by an estimated 15-20 per cent if alternative routes to markets in the EU and Africa need to be used in the days to come, a source tracking the matter told businessline. - Also Read: [LIC gets time till 2032 to achieve minimum public shareholding norms]( ”We expect that we would reach that (last fiscal’s) level of agriculture exports in spite of $4-5 billion impact due to the (export) restrictions,” Rajesh Agarwal, Additional Secretary, Commerce Ministry, said in an interaction with reporters on Thursday. In 2022-23, India’s farm exports were estimated at $53.15 billion. Exports at risk Basmati rice exports are now the biggest commodity in India’s farm export basket with exports of the premium variety touching $3 billion till October this year, officials said. Export of basmati rice could be higher by 15-20 per cent this fiscal, per government estimates. But basmati rice exporters could face a hitch in the coming days if the Houthi rebel attacks on the Red Sea force them to change the shipping route for their shipments, another source said. - Also Read: [On cloud nine: Indians lap up US tech shares amid rally]( “Commerce Department officials had a meeting with basmati exporters on the risk their shipments face in the Red Sea. While right now there is no impact but if the risk continues then they may have to opt for alternative routes to their destinations in the EU and Africa. This could increase their costs by 15-20 per cent which will reflect on prices,” the source said. As basmati is a premium product and the demand is largely inelastic, the hope is that demand would not be affected in case prices go up, the source added. You Might Also Like [Allcargo Logistics and Allcargo Gati approve scheme for business restructuring]( [Logistics]( [Allcargo Logistics and Allcargo Gati approve scheme for business restructuring]( [Piramal, IIFL Finance declare AIF exposure to assuage provisioning concerns]( [Money & Banking]( [Piramal, IIFL Finance declare AIF exposure to assuage provisioning concerns]( [On cloud nine: Indians lap up US tech shares amid rally]( [Markets]( [On cloud nine: Indians lap up US tech shares amid rally]( [Ayodhya’s epic makeover with big infra upgrades spurs realty boom]( [News]( [Ayodhya’s epic makeover with big infra upgrades spurs realty boom]( Stay informed Subscribe to businessline to stay up-to-date with in-depth business news from India [arrow]( Copyright @ 2023, THG PUBLISHING PVT LTD. If you are facing any trouble in viewing this newsletter, please try [here]( Manage your newsletter subscription preferences [here]( If you do not wish to receive such emails go [here](