Paddy prices jump on short supply

Paddy prices jump on short supply
eKantipur.com, 3-Jan-08

A ban slapped by India on the export of paddy to Nepal has cut down its supply in the local market and caused the prices of paddy and rice to shoot up.

Traders said the prices have already gone up by around 30 percent this season compared to a year earlier. India banned the export of food grains like rice and wheat to contain their prices. The price of Sona Mansuli rice, used mostly by people of the lower and medium classes, has reached Rs 1,450 per quintal, up from last year's Rs 1,100. Likewise, a quintal of basmati rice now costs Rs 2,400 where as it was available at Rs 1,800 a year ago.

The price rise came despite a robust 17 percent growth in paddy production in the country.

Fresh data from the Birgunj Customs shows that the country imported 26,448 metric tons of paddy and 3,276 metric tons of rice in the first quarter of the current fiscal year. No rice or paddy was recorded to have been imported since then.

“The prices will keep rising as stock keeps depleting,” Tara Prasad Gupta, a rice trader, told the Post. After carrying out a research on the possible impact of India's ban, Nepal Rastra Bank's Birgunj Regional Office has suggested that the government request India to roll back the ban. As internal production can only meet 65 percent of the total demand, Nepal has no option but to import paddy and rice to feed its people, the research said.