Indian Rice Exports to US Stay Firm Despite Higher Tariffs

Indian rice exports to the United States have remained stable despite a sharp increase in import duties, according to the Indian Rice Exporters Federation. Dev Garg, representing the industry body, told CNBC TV18 that the US continues to be an important market, though not a dominant one for India.

His comments follow US President Donald Trump’s announcement of fresh tariffs on agricultural imports, including Indian rice, citing complaints from American farmers about cheaper imports. Despite these measures, demand for Indian rice has not weakened significantly.

Export Volumes and Market Position

India exported approximately $374 million worth of basmati rice to the US, translating to around 270,000 metric tonnes. The United States ranks as the fourth-largest market for Indian basmati rice, highlighting its relevance in premium segments.

For non-basmati rice, exports stood at nearly 60,000 tonnes, making the US the 24th largest destination for Indian exporters. These figures underline that while the US is not India’s top buyer, it remains a steady and valuable market for specialised rice varieties.

Consumer Preference and Market Dynamics

Industry representatives explained that Indian rice caters to a specific consumer segment in the US, primarily expatriates from South Asia and the Gulf region. Garg emphasised that rice is not a homogeneous commodity and cannot be easily substituted with US-grown varieties.

This unique preference ensures continued demand despite higher tariffs and rising retail prices. Cultural and culinary factors play a significant role in sustaining Indian rice consumption among diaspora communities.

Impact of Tariffs and Retail Prices

Import duties on Indian rice were raised from 10% to 50%, significantly increasing costs for US importers. Garg noted that these additional charges are being passed on to consumers rather than absorbed by exporters.

Retail prices for popular packs have surged, with a 10-pound bag now selling for around $18 to $19 compared to $13 to $14 earlier. Despite this increase, Indian exporters continue to realise roughly the same value, averaging about $950 per metric tonne.

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Conclusion

Indian rice exports to the US have shown resilience despite tariff hikes and political pressure. Strong consumer preference among niche communities and the inability to substitute Indian varieties have supported demand.

While retail prices in the US have risen sharply, exporters maintain stable realisations, indicating limited impact on India’s trade flows. The situation underscores the strength of cultural demand in sustaining agricultural exports even under challenging trade conditions.

Disclaimer: This blog has been written exclusively for educational purposes. The commodities mentioned are only examples and not recommendations. This does not constitute a personal recommendation or trade advice. It does not aim to influence any individual or entity to make trade decisions. Recipients should conduct their own research and assessments to form an independent opinion about trade decisions.