SHREE KRISHNA RICE & GENERAL MILLS

Basmati Market Outlook – 2025

Mid Feb Edition-16.02.2025

Namaste,

This is Abhinav from Shree Krishna Rice & General Mills.

I am writing directly from our facility in Punjab, where we are actively procuring, milling, and shipping basmati every day. What I am sharing today is not based on speculation or market rumors — it is based on what we are witnessing first-hand at the mandi level and inside the mills.

Let me explain the current situation clearly.

Crop Reality – A Structurally Short Year

This season, the basmati crop across Punjab, Haryana, and Western Uttar Pradesh has come in approximately 40 to 50 percent lower than a normal year.

On paper, this number may sound like just another percentage. But on the ground, it means something entirely different.

Mandi is receiving limited arrivals. Procurement is slower and more competitive. Replacement cost of paddy is rising steadily week after week. Many mills are operating below capacity, and some may temporarily suspend operations due to shortage of raw material.

In practical terms, the total available milling stock for the year is substantially lower. This makes the current firmness in pricing structural rather than temporary.

Ramadan Cycle and Stock Position

We are entering the Ramadan demand period, which traditionally increases consumption in key importing markets.

The difference this year is that we are entering this demand cycle with historically low carry-forward stocks. Even at elevated price levels, the market is not showing signs of softening because the supply base itself is weak.

This is not trader-driven speculation. It is a genuine agricultural shortage. When the base crop is short, meaningful corrections become unlikely.

Iran – A Significant Structural Shift

Iran has removed subsidized currency support, which has opened the market environment.

More private buyers are active. Smaller and medium importers are making fresh inquiries. Payment channels are stabilizing.

Historically, whenever Iranian demand resumes in a meaningful way, it tightens the premium basmati segment first and gradually strengthens the overall market structure. We are beginning to see that effect again.

United States – Renewed Positivity

The U.S. market is also showing renewed interest.

With tariff pressures easing and improved competitiveness for Indian basmati, retail and food-service channels are increasing inquiries. The United States is not only a volume market; it also influences global pricing sentiment. When demand strengthens there, it impacts expectations worldwide.

GCC Markets – Stable and Consistent

The UAE, Saudi Arabia, Qatar, and Oman continue to show steady retail activity and HoReCa sales.

Forward buying interest is visible due to global supply tightness. These markets remain supportive and stable, underlining the strong sentiment in the overall market.

Our Practical Advice to Buyers

This is not a year where waiting for a major correction appears strategic.

There could be some fluctuations in the short term, but given the reduction in yield and the fact that there are several factors at play in terms of demand, it is likely that any reduction will be only temporary.

The advice that we offer is simple and can be implemented:

Fix your basic needs for consumption at the current level. Protect your core SKUs and maintain pipeline continuity. Opportunistic buying can always be evaluated later, but essential supply should not be left uncovered in a structurally tight year.

Continuity and stability are more important than attempting to time the exact bottom.

Our Commitment

At Shree Krishna Rice & General Mills, our strategy is the same in all request conditions.

We continue to offer authentic Punjab-origin basmati, processed with modern milling infrastructure and strict quality standards. Transparent communication remains our principle, especially in challenging cycles.

In good years and bad years, our commitment is to long-term association, not short-term advantage.

Closing

In tough market conditions, the truth is more important than hope.

It is our duty to give you the true picture so you can take informed and confident action.We remain committed to supporting your business with reliability, consistency, and honest guidance.

CURRENT FOB PRICES OVERVIEW

We Thanks you all for your continued support