Shares of most rice stocks declined on Monday after the Union government decided not to allow exports of basmati rice below $1,200 per tonne.
The move is aimed at restricting possible illegal shipment of white non-basmati rice in the garb of premium basmati rice.
Contracts with the value of below $1200 per tonne may be kept in abeyance, according to a release by the Ministry of Commerce on Sunday.
It may be evaluated by a committee to be set up by the chairperson of the Agricultural & Processed Food Products Export Development Authority for understanding the variation in prices and use of this route for export of non-basmati white rice, the release said. "(The) APEDA should hold consultations with trade to sensitise them about the matter and work with them to discourage any use of this window for export of non-basmati white rice."
Shares of Chaman Lal Setia Exports Ltd. plunged 5.73% compared to a 0.07% gain in the benchmark NSE Nifty 50 as of 10:06 a.m. KRBL Ltd. declined over 2% and Kohinoor Foods Ltd. was down by 1.51%.
Shares of LT Foods Ltd. advanced over 1% after it clarified that the basmati export limit did not impact exports for the company, which mostly exports premium and aged rice via Daawat and Royal brands. It said in an exchange filing that the export price of these was mostly over and above the minimum export price limit.
Watch | KRBL's Ashish Jain and LT Foods' Ashwani Arora discuss road ahead for the sector
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