Shares of these companies decline as India restricts rice exports
New Delhi [India], September 9 (ANI): Shares of companies dealing in rice such as KRBL, Chaman Lal Setia and LT Foods slumped on Friday after India banned the export of broken rice and curbed shipments of some varieties.
At the time of writing this report, the shares of these three companies fell in the range of 2-5 per cent.
The Centre on Thursday imposed a 20 per cent export duty on non-Basmati rice, except for parboiled rice, to boost domestic supplies amid a fall in area under the paddy crop in the current Kharif season. The export duty will come into force from today.
According to a notification by the revenue department, an export duty of 20 per cent has been imposed on 'rice in the husk (paddy or rough)' and 'husked (brown) rice'.
The Central Board of Indirect Taxes and Customs further said the export of 'semi-milled or wholly-milled rice, whether or not polished or glazed (other than Parboiled rice and Basmati rice)' will also attract a customs duty of 20 per cent.
Further, India banned the export of broken rice with immediate effect. The export policy has been revised from "free" to "prohibited".
The ban on exports assumes significance as it appears that the overall sown area under paddy this Kharif season could be lower than that of last year. This can have an impact on both crop prospects as well as prices going forward.
This Kharif season, the area under paddy cultivation is around 6 per cent lower than the previous season at 383.99 lakh hectares.
Farmers in India have sown less paddy this Kharif season. Kharif crops are mostly sown during monsoon -June and July, and the produce is harvested during October and November.
The primary reason for the decline in the sown area could be attributed to the slow advancement of the monsoon in the month of June and its uneven spread in July in some key growing regions in the country.
Many in India were worried that less area under paddy under cultivation so far this Kharif may lead to low production of the foodgrain. (ANI)
Source: Business