Basmati rice is now the top commodity that is exported from India and has replaced buffalo meat for the April-June quarter, driven by a continued rise in demand from Iran.
Iran, one of the largest importers of Indian basmati rice, generally suspends import orders during its harvesting season. However, this year, the traders did not suspend the rice import orders and continued to buy basmati from India even during their harvesting season, Business Standard reported.
"Iranian buyers have continued their purchases even during their own rice harvesting season. That has resulted in an increase in basmati rice exports in April-June," said an Agricultural and Processed Food Products Export Development Authority (Apeda) official.
Also, the Narendra Modi-led government's order to ban buffalo meat's sale is partly another reason why the export took a hit and basmati rice climbed on to the top spot. Buffalo meat was the most exported commodity since the 2014-2015 financial year.
According to Apeda figures, India exported basmati rice worth $1.26 billion (Rs 8,168 crore) between April and June from $934 million (Rs 6,196 crore), in the same quarter last year.
Buffalo meat exports were $849 million (Rs 5,473 crore) during the quarter against $823 million (Rs 5,445 crore) in the same quarter a year ago.
"Indian exporters used to execute orders on documents against acceptance, which was stopped by the government because overseas buyers' re-negotiated terms after shipments reached them. So, there were corrections in the export of basmati rice over the last few years. Now, overseas buyers are purchasing commodities on spot cash," added the Apeda official.