Mumbai, June 17: Prices of basmati rice in India may soon fall, as ongoing tensions between Iran and Israel are affecting India’s rice exports to Iran, one of its biggest buyers. According to the Agricultural and Processed Foods Export Development Authority (APEDA), Iran was the third-largest importer of Indian basmati rice in 2024–25, buying INR 6,374 crore worth of rice. This is nearly 13% of India’s total basmati exports.

But now, due to the conflict, exporters are facing problems with shipping and rising freight costs. “Export prices have dropped from $950–1,000 per tonne to $900–950,” said Rajesh Jain Paharia, a leading basmati rice exporter. He added that these drops are mainly because of delays in transshipment and higher logistics charges. Iran-Israel Conflict: Indian Students Evacuated From Tehran, Some Moved Out of Country Through Border With Armenia, Says MEA.

Prem Garg, President of the Indian Rice Exporters Federation, stressed the need for market diversification. “Relying too heavily on a few conflict-hit regions makes our trade vulnerable. We need to expand into newer markets,” he said.

There are also problems with payments. Exporters say they are waiting on dues worth INR 1,000–1,200 crore from Iran, as sanctions and money transfer issues have made banking difficult. Israel-Iran War: Indian Students Being Relocated to Safer Places in Iran Amid Escalating Tensions, Says MEA.

In the last two months, basmati prices had increased by 15–20% as Gulf countries including Iran had bought heavily when prices dropped to INR 75–90 per kg. Now, with fewer orders expected from Iran, prices may drop or stabilise.

Experts say if the conflict continues, rice exporters may face more trouble, and India will need to explore new markets to reduce risk. However, if the war escalates, global buyers might again rush to stock up, which could push prices up for a short time.

For now, exporters expect short-term price stability unless the conflict worsens. However, any further escalation could once again push countries to increase foodgrain imports, leading to temporary price spikes.

(The above story first appeared on LatestLY on Jun 17, 2025 05:00 PM IST. For more news and updates on politics, world, sports, entertainment and lifestyle, log on to our website latestly.com).