The organized buyers in Saudi Arabia have collectively decided to purchase Indian Basmati rice from regular suppliers for the new crop. The increase in paddy prices due to reduced acreage has been accepted, with average prices for parboiled rice being over $200 per metric ton higher than the last crop year. Indian private label suppliers are consolidating, with some larger players expanding vertically integrated capacities. Basmati rice from India is expected to see robust demand driven by the organization of the Indian retail industry and implementation of basmati rice definitions in domestic markets. Some industry sections expecting a drastic reduction in prices this year may be disappointed, as it is in the interest of all in the value chain to have a clear distinction in price between

1. Amira Foods Basmati Finally Gets Its Due
The kingdom of Saudi Arabia Buyers form joint purchase strategy, but high prices are here to stay.
In a surprising move which is welcomed by the Indian industry, the organized player in Saudi Arabia have
together made a collective decision to purchase Indian Basmati rice from regular supplier for this new
crop.
The increase in prices of paddy due to reduces acreage has been well accepted and the average prices
for Parboiled are higher by over USD 200 PMT over last crop year.
Indian private label suppliers are now also in a stage of consolidation, some of the larger players are
expanding capacities in vertical integration.
Beginning of organized times seems to be the flavor of the season as the Indian Economy continues its
robust growth.
Further it is estimates, that with the rising energy costs and land now termed as “Land Bank”, the return
the farmers is expecting is a lot higher. This is our opinion could lead to a significant increase in soft
Commodity prices over the next decade.
Basmati which is the heritage of the Indian sub Continent would witness a robust demand led by
organization of the Indian Retail Industry followed by the implementation of the definition of basmati
rice in domestic traffic area.
An in the United Kingdom the increase in the percentage sales is contributed by Microwave rice, the
same would eventually see trends in metros of India post the Retail Organisation. The Indian
Government committed to support the farmers would increase thew price in the season of 2007 which
would have its effect on basmati as well.
Section of the Industry Expecting a drastic reduction in prices over this year have a chance of being
disappointed. In our view it is
in the interest of all in the value chain to have a clear distinction in the price, that too a large one
between Basmati and long grain