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On Tuesday, December 9, the stocks of leading Indian rice exporters plunged sharply after US President Donald Trump indicated the possibility of new tariffs on agricultural imports, particularly on Indian rice and Canadian fertilisers. The remarks, made during a White House event arranged to announce the support measures for US farmers, intensified market concerns and triggered a sell-off in rice-related stocks.
LT Foods saw the steepest fall, slipping 6.85% to Rs. 366.55 in early trade, while GRM Overseas declined 4.46%. Shares of KRBL, India’s largest basmati exporter, were relatively resilient but still fell 1.14%.
Market participants attributed the correction to fears of additional trade barriers by the US, one of India’s key premium rice markets.
Trump’s comments came amid ongoing trade tensions between Washington and New Delhi. According to a Bloomberg report, he said countries such as India, Vietnam, and Thailand are “dumping” rice into the US at lower prices, making it difficult for American farmers to compete.
He reiterated that the administration would “take care of” the issue, although no specific policy details were disclosed.
The remarks come at a politically sensitive time, with midterm elections approaching in the US. American farmers, an influential voting group, have raised concerns over rising input costs, falling commodity prices, and growing reliance on cheaper imports.
India remains the world’s largest rice producer and exporter. Indian Rice Exporters Federation (IREF) stated that in 2024-2025, the country accounts for 28% of global production and 30.3% of rice exports worldwide.
Of the total US basmati rice imports of about 234,000 tonnes, Indian exports were under 5%. The West, especially the US and Australia, has a strong demand for premium rice varieties like Sona Masoori.
KRBL, during the last earnings call, said that although the export tariff of 50% on Indian rice is difficult, its direct exposure to the US market is minimal.
LT Foods is more vulnerable to tariff changes as nearly its 46% revenue comes from North America. The company's flagship basmati brand has a 61% share in the US basmati import market, while its Golden Star brand is the leader of the Jasmine rice category.
The timing of Trump’s remarks coincides with an upcoming visit by a delegation led by Deputy US Trade Representative Ambassador Rick Switzer, scheduled to hold discussions with Indian officials on December 10-11. Tariffs on rice and related agricultural imports are expected to be a key focus.
US officials have also hinted at reviewing fertilizer imports, including Canadian potash, which could further affect agricultural supply chains.
