KRBL, Kohinoor Foods, LT Foods rise as investors cheer removal of non-basmati rice export ban

Basmati rice exporters buzzed in Monday's trade on Dalal Street after the central government removed a ban on the export of non-basmati white rice while imposing a minimum export price (MEP) of $490 per tonne on the category. Stocks like KRBL, Kohinoor Foods, LT Foods, and Chaman Lal Setia staged strong moves during the session. In afternoon deals, KRBL was up 1.4 per cent, Kohinoor Foods up 14.1 per cent, LT Foods 2.0 per cent, and Chaman Lal Setia up 3.7 per cent. Many analysts said that the lifting of the ban, which restricted traders from exporting non-basmati white rice, is a much awaited move that is positive for the segment.

The ban on non-basmati white rice was imposed in July 2023 with an aim to boost domestic supply.

"The lifting of ban on exports of non-basmati white rice has been long awaited by traders... Favourable monsoon rains and a good crop of non-basmati rice across the country has allowed the government to lift the restrictions placed last year. The parboiled rice and brown rice are allowed with 10 per cent export duty while white rice is allowed without any duty but an MEP of $490 PMT FOB," said Akshay Gupta, Head-bulk exports at KRBL Ltd. 

India exports about 9 million tonnes of white rice and 7 million tonnes of parboiled rice annually. 

"Global rice prices will surely be impacted and will see a fall in the prices as the world’s biggest exporter of rice comes back in the market quite strongly," said Gupta. 

The move will further enable KRBL to explore sale of branded regional rice products, he added. 

Meanwhile, the policy changes in the rice industry is expected to aid the reopening of 500-600 rice mills in West Bengal. The mills were reportedly closed due to a sharp fall in demand in the wake of export restrictions.

With inputs from agencies

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