Rice exporters of Non-basmati rice fear that the currency crisis in Nigeria could pull down shipments in this current year. Nigeria, one of the big importers of Indian non-basmati rice in Africa, recently stopped dollar sales to importers of rice and other commodities in the country, to protect its lowering of forex reserves. In fact, the Nigerian move on forex sale to exporters will affect rice shipments of all origin and it is expected that it could impact our overall shipments by about 10 per cent in the current year, according to a large exporter Mr BV Krishna Rao, Managing Director of Pattabhi Agro Foods.
Since, Nigeria is one of the largest buyers of par-boiled rice and it is estimated that Indian exporters account for it imports close to half of the 2.5 million tonnes. The bulk of the Indian rice sold to Nigeria is through global traders such as Platinum Corp and Louis Dreyfus while some shipments are routed to Nigeria through countries such as Benin.
Further, a fall in the local currency niara against the dollar and sharp decline in crude oil prices as well as the change in Government have created a bad impact on the rice imports. However, payments have not been hit as Indian exporters route their shipments through global traders.
As per reports available, the new government in Nigeria has not yet approved rice imports. It is a matter of time before they open up as stocks are down and they’ll have to import. Ultimately the demand will come up, according to an official of the trading house. Somehow, the drop in demand from countries such as Nigeria has not impacted paddy prices as the Government has procured more crops this year.