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The Indian government is discussing a plan to ban exports of all non-Basmati rice, according to people familiar with the matter. The move is being considered because domestic rice prices are rising and authorities want to avoid more inflation.
A ban on non-Basmati exports would remove a large share of global rice supply and push international prices sharply higher. Feed buyers using rice byproducts or substitutes would face higher costs.
bloomberg.comSiddhartha Singh, Pratik ParijaJul 13, 2023After 168 past bullish policy events, Rough Rice moved a median +0.8% over 5 sessions (57% higher; middle half -1.7% to +2.1%), and -0.4% over 20.
Moves of each commodity's benchmark from the last close before the event. Historical reads pool past events of the same kind; they describe what happened, not what will. Not investment advice.
Reports of a possible Indian ban on non-Basmati rice exports signal a major trade-flow disruption and tighter global supply, though a price drop of this size is the opposite of the expected rally and suggests the move may be a contract or data artifact.
Reports on 2023-07-13 that India may ban most non-Basmati rice exports bear directly on global rice supply, but a ban would normally push prices up, so it does not explain a 13% drop and may have only influenced volatility.
Reports of a possible Indian ban on non-Basmati rice exports on 2023-07-13 are a major trade-flow shock, but they would normally push prices up rather than cause a 20% drop, so this is only a partial and uncertain explanation (e.g. a reversal after a prior spike, or contract roll or liquidity effects).
Report on 2023-07-13 that India is weighing a ban on non-Basmati rice exports is a major potential supply shock, though a drop of 6.22% is counterintuitive and suggests profit-taking or sentiment reversal in Chicago rough rice.
