APEDA suspends certification body, exporter for organic rice export irregularities
The Agricultural and Processed Food Products Export Development Authority (APEDA), the nodal agency for the National Programme on Organic Production (NPOP), has suspended the accreditation of an organic certification agency and an exporter besides penalising both.
The suspension and penalty follow a report by businessline that irregularities had been reported in the shipments of organic rice from India since last fiscal when the government banned white rice exports and imposed a 20 per cent export duty on parboiled consignments.
According to sources in the know, the decision to suspend Sikkim State Organic Certification Agency and Reliteaur Foods Private Limited was taken last week. The suspension will be for one year. Besides, both have been fined ₹10 lakh by APEDA.
Consignments of Reliteaur in merchant vessel mv Della have been detained by the Customs authorities since August. The company has moved the Gujarat High Court and the next hearing has been scheduled for October 17.
Data show that Reliteaur shipped 71,131 tonnes, the highest volume- during April-July this fiscal. Organic rice exports in the first four months of the fiscal were 1,46,585 tonnes compared with 1,07,727 for the entire 2023-34 fiscal. Of this, white rice made up 1,27,120 tonnes, broken rice 8,000-odd tonnes and parboiled rice made up the rest.
The majority of the shipments took place from JNPT (60,809 tonnes), Sonepat Inland Container Depot (30,624 tonnes) Mundra (26,049 tonnes) and Kandla (25,100 tonnes).
Most of the consignments headed to countries such as Vietnam (22,166 tonnes), Angola (22,100 tonnes), Mozambique (16,457 tonnes) and Kenya (11,801 tonnes) which do not import organic rice from India.
The US and Netherlands, India’s principal organic rice buyers, bought 13,626 tonnes and 16,457 tonnes, respectively, during the period. Vietnam, Madagascar, Kenya, Mozambique, other African countries and Malaysia are not traditional importers of organic rice. African nations have never imported Sona masoori and organic rice in such volumes, but they were found to have purchased them.
Declining prices
In view of the irregularities, the price of organic rice exports declined constantly since October 2023 — the timing coincides with the ban on exports of white rice in July. From $940/tonne in September 2023, the price declined to $529 in June 2024.
S Chandrasekaran, a Delhi-based trade analyst, said, “Unfortunately, the profiteering motto has overshadowed the integrity of organic agriculture. Though penalty has been imposed on offenders, we are repeatedly witnessing such incidents recur. Government should introspect over such recurrence.”
Traders wondered how organic rice could be sold at prices less than $500 a tonne when it fetches a premium. A trade source said the directors of Reliteaur are the same as Elite Green Private Limited, whose organic certification was withdrawn by NPOP and penalised ₹5 lakh in December 2023. “Action against Elite Green was taken as NPOP found major non-compliances and violation of NPOP. Why did the authorities not check the antecedents of the company when it registered?” the sources wondered.
Ban violation
While exporting white rice in the garb of organic rice, the shippers are reported to have violated the ban on white rice. (The ban was lifted on September 28, 2024). In the case of parboiled, they had dodged the 20 per cent export duty.
Following businessline’s report, the Department of Revenue Intelligence had detained over 400 containers. Some of the consignments shipped out as organic rice were found to be not organic at the landing port.
Data revealed that 22,126 tonnes and 16,547 tonnes of organic rice shipments had set sail for Vietnam and Kenya, respectively, but hardly 2,000 tonnes reached the destinations.
During the period, the Agricultural and Processed Food Products Exports Development Authority issued a higher number of transaction certificates (TCs), which certify a product to be organic. Data show that 1,325 TCs, a must to export organic products, were issued till July this fiscal compared with 799 during the same period a year ago.
The Centre curbed rice exports from September 2022 to September 2024 as production in key-growing regions were affected by prolonged dry period and deficient rainfall.