Kolkata, March 1 An association of Indian rice exporters advised its members to avoid new "cost, insurance, and freight" commitments to Iran and Gulf destinations, amid the deteriorating geopolitical situation in West Asia and the potential for restrictions on shipping through the Strait of Hormuz.
"Cost, insurance, and freight" (CIF) is a shipping agreement that ensures a seller covers the costs, insurance, and freight of a buyer's order when cargo is transported via a waterway.
The advisory comes after the US and Israel launched a major attack on Iran on February 28, with Iranian Supreme Leader Ayatollah Ali Khamenei killed early on Sunday.
The Indian Rice Exporters Federation (IREF) asked its members to conclude sales on free-on-board (FOB) terms, wherever feasible, so that freight, insurance, and related risks remain with the international buyer.
The organization said that developments in Iran and the United Arab Emirates could have an immediate impact on bunker (supplying fuel to ships) prices and may disrupt container and bulk vessel availability.
"In such circumstances, container and bulk freight could increase sharply at short notice, exposing exporters to losses on fixed delivered-price contracts," the federation said.
It also cautioned that insurance premiums could rise steeply if the situation worsens.
Exporters were advised to exercise restraint while concluding new orders and avoid open-ended, unhedged positions.
India's rice trade with Africa and West Asia together accounts for roughly half of the country's total rice exports.
During the April–December period of 2025, exports to West Asia stood at about 3.90 million tonnes, while shipments to Africa were around 7.16 million tonnes.
The federation noted that five of the leading basmati rice destinations—Saudi Arabia, Iran, Iraq, the UAE, and Yemen—are located in West Asia and together account for around 50 per cent of India's basmati exports.
With basmati wholesale prices already rising by 10–15 per cent over the past month and Iran being a key market, the federation expects heightened volatility in prices in the coming days.
IREF said it is closely monitoring developments and is in touch with exporters whose consignments are in transit or awaiting clearance at destination ports.
It added that further advisories would be issued as the situation evolves.
