India Rice & Derivatives Market- Trend Analysis & Forecasts

Market/ Product Overview

Rice is not just a staple crop in India; it is a strategic economic asset. The country cultivates rice across 44 million hectares, producing 135–140 million tonnes of milled rice annually, representing nearly 21% of global production. Basmati rice accounts for around 9% of total output but contributes nearly US$ ** billion in export revenue each year. Non-basmati rice, meanwhile, dominates domestic consumption, estimated at 100 million tonnes annually, meeting the dietary needs of over 1.4 billion people.

India’s rice processing industry is highly fragmented, with over 90,000 mills, of which about 70% are small or medium enterprises. Modernized mills with automated grading, polishing, and packaging lines—particularly in states like Punjab, Haryana, Uttar Pradesh, Andhra Pradesh, and West Bengal—are now setting new benchmarks for efficiency and export quality.

In parallel, the rice derivatives sector is emerging as a major value driver. Rice bran oil production has surpassed ** million tonnes, with edible-grade output growing at **% CAGR thanks to strong demand in both domestic and export markets. Broken rice, which represents ** % of total output (around ** million tonnes), is increasingly diverted to ethanol production under India’s biofuel blending program, generating additional industrial demand worth over US$ ** billion.

Significance of India in Global Rice & Derivatives Supply Chain

India is the world’s largest rice exporter, accounting for roughly 40% of global shipments. In 2024, the country exported about ** million tonnes of rice valued at US$ ** billion, despite partial export restrictions on non-basmati white rice. Its extensive logistics network—ranging from inland procurement centers to export hubs at Kandla, Mundra, Vizag, and Chennai ports—makes India a global price setter for several grades of rice.

Beyond grains, India is the second-largest producer of rice bran oil, contributing nearly **% of global supply, with key markets in Japan, Vietnam, and the Middle East. Additionally, de-oiled rice bran (DORB) exports are rising steadily, reaching over ** million tonnes in 2024, mainly for animal feed. This strong downstream linkage enhances India’s reputation as a full-value rice ecosystem—from farm to fuel, food, and feed.

The country’s integrated value chain—combining primary production, modern milling, oil extraction, feed processing, and ethanol blending—positions it uniquely among global agri exporters. With rising global focus on sustainable sourcing and food security, India’s ability to maintain consistent supply even in adverse climatic conditions underlines its systemic importance.

India Rice & Derivatives Supply & Demand Trend

India’s rice supply is anchored in high-yield states such as West Bengal, Uttar Pradesh, Punjab, Tamil Nadu, and Andhra Pradesh, which together contribute nearly 70% of national output. Average yield has improved from 2.8 MT/ha in 2012 to 3.4 MT/ha in 2024 due to the adoption of hybrid seeds, SRI (System of Rice Intensification) techniques, and mechanized harvesting.

On the demand side, India consumes around 100–105 million tonnes of rice annually. About 90% goes to direct food use, while the remainder is processed into flour, starch, snacks, and feed. The per-capita consumption remains high at 74–76 kg per person per year. Rising urban incomes have spurred demand for branded, packaged, and parboiled rice categories, expanding the organized retail share from 18% in 2018 to nearly 28% in 2024.

Feed and industrial demand for broken rice and bran derivatives is accelerating. In 2024, ** million tonnes of broken rice were diverted for ethanol manufacturing, a segment expected to grow at 8% CAGR as the government pushes toward 20 % ethanol blending by 2030. Additionally, rice flour and starch demand from food processors is expanding at 6% CAGR, driven by the bakery and baby-food industries.

Supply stability is occasionally challenged by erratic monsoon patterns and export bans aimed at domestic price control. However, India’s large buffer stocks—maintained by the Food Corporation of India (FCI) at over 25 million tonnes—ensure national food security and steady domestic supply.

India Rice & Derivatives Market Growth Factors

India Rice & Derivatives Market Segmentation

The India rice & derivatives market can be segmented by product type, grain type, derivative type, and end-use application.

By Product Type

India rice market by product type segmented as Basmati rice and non-basmati rice. Basmati rice represents a relatively small share—around 8–10% of India’s total rice output—yet it remains the country’s most prestigious and profitable export segment. Known for its unique aroma, long grain, and cooking quality, basmati rice is cultivated primarily in the Indo-Gangetic plains of Punjab, Haryana, Uttar Pradesh, and parts of Delhi, with annual production estimated at ** million tonnes. In 2024, India exported over ** million tonnes of basmati rice, generating foreign exchange earnings of more than US$ ** billion. Export prices averaged between USD 1,100–1,300 per tonne, reflecting strong demand from West Asia, the EU, and North America. Despite accounting for less than one-tenth of production, basmati rice contributes nearly one-third of India’s total rice export revenue, underscoring its high value addition. The segment is dominated by leading brands such as India Gate (KRBL Ltd.), Daawat (LT Foods), and Lal Qilla (Amira Foods), which collectively hold over **% of branded export share. These companies have invested heavily in branding, traceability, and packaging innovations to meet international quality standards, thereby sustaining premium margins and consumer trust in global markets.

In contrast, non-basmati rice forms the backbone of India’s rice economy, accounting for over 80% of total production and serving both domestic and international markets. Annual non-basmati exports reached ** million tonnes in 2024, valued at US$ ** billion, despite intermittent export duties and restrictions. Non-basmati rice dominates domestic consumption at nearly ** million tonnes per year, providing an affordable staple for rural and low-income populations. The segment also plays a critical role in food security programs such as the Public Distribution System (PDS) and PM Garib Kalyan Anna Yojana, ensuring access to subsidized grain for over 800 million beneficiaries.

From a value-chain perspective, non-basmati rice has increasingly become an industrial feedstock. Broken rice—a by-product of milling—constitutes **% of non-basmati output and is now diverted for ethanol production, animal feed, and processed foods. With growing demand from distilleries and feed manufacturers, the non-basmati segment is evolving from a low-margin bulk commodity to a diversified industrial raw material base. Together, basmati and non-basmati rice reinforce India’s dual advantage in the global market—premium value through basmati exports and large-scale affordability through non-basmati supply—making the country indispensable to global food security and trade stability.

By Derivative Type

India’s rice derivatives industry has emerged as a powerful growth engine within the broader rice value chain, contributing an estimated US$ ** billion annually to the agri-industrial economy. Rice bran oil (RBO) stands at the forefront, with production surpassing ** million tonnes in 2024, positioning India as the second-largest producer globally after China. The oil’s unique nutritional composition—rich in oryzanol and vitamin E—has driven its adoption in both edible and nutraceutical markets. Domestic consumption of RBO exceeded ** thousand tonnes in 2024, growing at around 7% CAGR, supported by government campaigns promoting healthier cooking oils and the entry of leading brands like Ricela, Adani Wilmar, and SVROil. Export demand, particularly from Japan, Vietnam, and the Middle East, continues to strengthen, with margins averaging **%, higher than raw grain trade.

De-oiled rice bran (DORB), the solid residue left after oil extraction, plays a vital role in India’s livestock and aquafeed sectors. Annual DORB output is estimated at ** million tonnes, with about 1.4 million tonnes exported in 2024, mainly to Senegal, Vietnam, Bangladesh, and the Philippines. Its high protein and fiber content makes it a cost-effective alternative to soybean meal in animal feed formulations. Growing poultry and aquaculture industries, expanding at 6–8% per year, have boosted domestic DORB consumption and stabilized bran prices for processors.

Broken rice, once considered a low-value by-product, has gained industrial importance as a feedstock for ethanol production, rice flour, and starch. Nearly ** million tonnes of broken rice were utilized by distilleries in 2024, generating over US$ ** billion in industrial revenue and directly supporting India’s ethanol blending target of 20% by 2030. The diversion of broken rice toward biofuel has redefined the downstream dynamics of the rice sector, linking agriculture with renewable energy.

Collectively, these derivative streams—bran oil, DORB, and broken rice—have transformed India’s rice industry from a traditional grain-export economy into an integrated “food–feed–fuel” value chain, adding stability, employment, and higher returns across rural production hubs.

By End-use Application

By end-use application, the Indian rice and derivatives market is dominated by the food and beverage sector, which accounts for nearly **% of total consumption, driven by household demand, packaged rice, and processed food industries. The industrial and biofuel segment has expanded rapidly, utilizing about ** million tonnes of broken rice for ethanol production, contributing roughly **% to total market demand. The feed industry represents around **%, primarily consuming de-oiled rice bran (DORB) for livestock and aquaculture feed. Emerging uses in pharmaceuticals, starch, and gluten-free foods are expected to grow at 6–7% CAGR through 2032, underscoring India’s evolution from a grain-based market to a diversified agri-industrial ecosystem.

India Rice & Derivatives Trade (Export & Import) Trend

India remains a net exporter of rice and rice derivatives, importing minimal volumes of specialty rice (mainly for diaspora markets). Exports are diversified: Basmati flows to Iran, Saudi Arabia, UAE, and the EU, while non-basmati varieties target Bangladesh, Benin, Togo, and Senegal.

In 2024, total rice exports were around ** million tonnes, generating US$ ** billion. Derivative exports—including bran oil, DORB, and rice flour—contributed an additional US$ ** billion. India’s trade policies impose an export duty of **% on select non-basmati grades during supply stress, though such measures are periodically reviewed.

The country’s zero-import-duty policy on certain feed inputs and edible oils helps stabilize domestic prices. Trade corridors through Mundra, Kandla, Vizag, and Tuticorin handle over **% of rice exports, benefiting from cold-chain and bulk handling modernization.

Logistics reforms under PM-Gati Shakti and investments in Inland Water Transport (IWT) are expected to reduce freight costs by **% by 2030, enhancing India’s competitiveness.

Influence of India in Global Rice & Derivatives Price

India’s export volumes give it significant price-setting power in the global rice market. Benchmark Indian **% broken non-basmati prices have historically set reference rates for Asia and Africa. Between 2018 and 2024, export prices fluctuated between US$ ** per tonne, with peaks during export bans and global supply disruptions.

Basmati export prices average US$ ** per tonne, closely tied to premium quality and branding. Domestic wholesale rice prices typically range between US$ ** per tonne, depending on region and season. India’s decisions—such as export curbs in 2023—instantly impacted global prices, pushing Asian benchmark rates up by nearly 25%.

Derivative pricing follows similar dynamics: rice bran oil averages US$ ** per tonne, while DORB prices fluctuate between US$ ** per tonne, influenced by feed and biofuel demand. These linkages underline India’s pivotal influence on the entire rice value chain, from grain to derivative commodities.

Market Competitive Landscape

Future Outlook

The outlook for India’s rice and derivatives market remains robust through 2032. Driven by productivity gains, export competitiveness, and industrial diversification, total market value is projected to climb from US$ ** billion in 2024 to around US$ ** billion by 2032. Basmati exports are likely to maintain a **% annual growth, while non-basmati exports expand at **% as African demand strengthens.

Investments in climate-resilient seed varieties, digital traceability, and sustainable milling will reshape competitiveness. The sector’s profitability will depend on managing resource use, particularly water and energy, while enhancing export reliability through stable trade policies. By 2032, India is poised not only to remain the largest rice exporter but also to evolve into a global leader in rice-based derivatives, integrating food, feed, and fuel into a sustainable agro-industrial framework.