Amid a decline in the area under paddy cultivation this year and weather-related crop damage, higher prices for basmati paddy have brought some relief to farmers. Prices of premium basmati varieties have crossed Rs. 5,000 per quintal in mandis across Punjab and Haryana, with rates for the popular Pusa 1121 variety touching Rs. 5,500 per quintal in some markets.
Farmers are currently receiving around Rs. 4,500-5,500 per quintal for basmati paddy, compared with Rs. 3,500-4,500 during the corresponding period last year. Farmers in Haryana and Punjab are fetching Rs. 1,000-1,500 more per quintal this season than last year. The primary reason is stronger demand from West Asian and Gulf countries.
The ongoing conflict involving the US, Israel, and Iran has heightened concerns over food security in international markets. Importing countries are building up their rice stocks, supporting demand and prices for Indian basmati.
Strong Export Demand Supports Basmati Prices
Satish Goyal, President of the All India Rice Exporters Association (AIREA), told Rural Voice that basmati paddy prices have reached Rs. 5,000-5,500 per quintal.
He said strong international demand has enabled exporters to offer better prices to farmers. Increased demand from Gulf countries amid the Iran-US conflict has supported domestic prices. However, exporters are facing challenges from rising ocean freight rates and disruptions and uncertainty along key maritime shipping routes.
The strong export demand for basmati rice is benefiting farmers this season. Tejveer Singh, a farmer from Ambala district in Haryana and a leader of the Bharatiya Kisan Union (Shaheed Bhagat Singh), said farmers had anticipated higher basmati prices this year in view of the international situation.
As a result, many growers are holding back their produce instead of selling it immediately, hoping to secure better prices later. He said the harvesting season had only just begun and farmers were expecting prices to rise further by December.
Basmati Rice Prices Also Rise
The increase in basmati paddy prices has also pushed up the prices of milled basmati rice. In Delhi, the price of 1121 basmati rice has reached Rs. 10,600-10,800 per quintal, while in Karnal, Haryana, the same variety is trading at around Rs. 9,525-9,725 per quintal.
Amid stronger export demand, the export price of 1121 basmati rice at Mundra and Kandla ports has increased by around 6% in a week to reach $1,156 per tonne.
India Exports Over 6.5 Million Tonnes of Basmati Rice
West Asian and Gulf countries account for a significant share of India's basmati rice exports. India exported 6.521 million tonnes of basmati rice in the financial year 2025-26, valued at $5.67 billion, equivalent to approximately Rs. 50,138 crore.
Saudi Arabia, Iran and the United Arab Emirates (UAE) are among the major buyers of Indian basmati rice. Geopolitical tensions in West Asia and uncertainty over food supplies have prompted importing countries to strengthen their rice inventories. This has supported international basmati prices, benefiting Indian farmers as well.
While higher prices have improved returns for farmers, exporters are concerned that a further rise in domestic basmati paddy prices could undermine India's competitiveness in international markets.