A shopkeeper arranges signs with prices on bags of rice at a shop in Mumbai March 19, 2009. Indian inflation headed towards zero in early March and analysts tipped it would soon turn negative, opening the way for the Reserve Bank of India to cut interest rates further to prop up demand and growth. The wholesale price index, India's most widely watched inflation measure, rose 0.44 percent in the 12 months to March 7, sharply lower than the previous week's 2.43 percent and below a forecast of 0.89 percent in a Reuters poll. REUTERS/Arko Datta (INDIA BUSINESS FOOD DRINK) - RTXCYWA
India's rice exports likely jumped 22 percent in 2017 to a record 12.3 million tonnes as neighbouring Bangladesh ramped up purchases after flooding hit its crops, industry officials told Reuters.
The boost in shipments from the world's top exporter of the grain is set to extend into 2018 as Bangladesh and Sri Lanka continue to buy aggressively amid depleting inventories in No.2 exporter Thailand, the officials said.
"Bangladesh was actively buying throughout 2017. It offset the impact of slightly weaker demand from African countries," said M. Adishankar, executive director at Sri Lalitha, a leading rice exporter located in the southern Indian state of Andhra Pradesh.
Bangladesh's purchases likely lifted India's non-basmati rice exports by 38 percent in 2017 to 8.4 million tonnes and total exports to 12.3 million tonnes, the officials and exporters said. That would surpass 2014's record of 11.5 million tonnes.
They based the 2017 export figures on their estimates for December shipments plus previously issued government data for January to November. Government numbers for December are expected to be released around the start of next month.
India exportsÂ non-basmatiÂ rice mainly to African and Asian countries and premiumÂ basmatiÂ rice to the Middle East, the United States and Britain.
Traditionally the world's fourth-biggest rice producer, Bangladesh emerged as a major importer of the grain in 2017 after floods damaged crops and pushed domestic prices to record highs.
Bangladesh sourced more than 80 percent of its 2017 imports of 2.4 million tonnes from India, said Badrul Hasan, head of Bangladesh's state grains buyer.
The South Asian nation's overseas rice purchases are likely to remain robust until supply rises after its summer crop, also known as Boro, in May, Hasan said.
Boro contributes more than half Bangladesh's typical annual rice output of around 35 million tonnes.
Last year Bangladesh reduced import taxes on rice to boost private buying. It also bought rice from India in state-to-state deals to quickly raise supplies and try to rein in prices.
But rice prices stayed high in Bangladesh despite the largest imports in nearly two decades, which will encourage farmers to expand the amount of land used to cultivate the staple crop, Hasan said.
India's rice exports in 2018 depend largely on non-basmati shipments as basmati exports are likely to remain more-or-less steady at around 4 million tonnes, said Vijay Setia, president of the All India Rice Exporters'Â Association.
"Non-basmati exports depend on stock positions in importing countries like Bangladesh and Sri Lanka," Setia said.
African nations stepped up buying from Thailand last year, but that could ease in 2018 as state stockpiles are depleted in the Southeast Asian country, potentially boosting appetite for Indian supply, said a Mumbai-based dealer with a global trading firm.
"For key markets like Bangladesh and Sri Lanka, India has freight advantage over Thailand. This will help even in 2018," the Mumbai-based dealer said.