The Telangana rice export industry is experiencing a decline amid High procurement costs and plummeting domestic demand. Millers are also claiming to have slashed shipments by an estimated 20-30 per cent in 2025 due to inflated procurement costs and the Plummeting in domestic demand from the government’s subsidised fine rice distribution through the public distribution system (PDS), afraid Telangana’s ambitious target of exporting 50-60 lakh tons annually to emerging markets such as Indonesia and Africa.
A rice miller and exporter from Nizamabad stated that Export markets are fast drying up amid high procurement costs and global competition.
Shockingly, Telangana’s rice millers are grappling in the international markets where Thailand and Vietnam are dominating as lower-priced alternatives.
Why are Telangana Rice Exports on decline?
According to the Industry data, India’s non-basmati rice exports are a segment where Telangana plays a significant role, and have fallen around 6.9 per cent in 2024 to 17.8 million metric tons. Due to the geopolitical tensions raising logistical and financial hurdles, Telangana’s rice exports decline has been showcased to be steeper, with exports to key markets like Saudi Arabia and the United Arab Emirates (UAE). These Middle Eastern nations used to be major buyers of Telangana’s premium fine rice once, but have scaled down their imports. Not only this, but the traditional markets in West Africa, including Nigeria, which absorbed a substantial share of India’s non-basmati exports earlier, are increasingly preferring cheaper Thai and Vietnamese rice now.
Rice Exports from other states offer competitive global rates
On the contrary, States like Andhra Pradesh and Punjab procure fine paddy at relatively lower prices, providing them a significant cost advantage. This allows them to export at competitive global rates, typically $400-$450 per tonne for premium varieties, whereas Telangana’s millers are struggling with costs inflated by the state policies.
The reduction in rice exports can coincide with a domestic crisis. Large rice mills in Telangana report a 55-60 per cent fall in operations due to factors such as procurement issues, rising milling costs and delayed government payments.
For instance, a wholesale trader from Warangal stated an objection that the daily sales were coming down from 25-30 quintals to just 2-3 in June and July as consumers turned to PDS-supplied fine rice.