Also, with Iran threatening to close the Strait of Hormuz — a vital trade artery — major shipping lines have suspended operations to Iranian ports. Thus, the insurance companies have reportedly backed out, unwilling to risk covering shipments through a war zone.Export prices, once commanding between USD 850 to USD 950 per tonne, have seen a 10–15 percent drop. With the new basmati crop expected to arrive from mid-September, the situation is set to worsen. The farmers might also face the brunt, as now the paddy sowing season has started and if the situation remains the same or even if it improves, it will take time for exports to resume, thus causing a further decline in prices.Farmer Sanampreet Mahrok of Fazilka district said, “We were hoping to get good prices, but under the present circumstances, the rates could fall by Rs 500 per quintal for both PUSA 1509, 1121, and other variants.”R S Sachdeva, former chairperson of the Punjab chapter of the PHD Chamber of Commerce and Industry, said that if the same situation continues when the new crop arrives amidst an already saturated market, prices will crash further.
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