Trade in basmati has suffered a setback after Iran stopped importing the rice.

Dhows carrying several tonnes of Indian and Pakistani basmati are stranded in Dubai and Sharjah after buyers in Iran backed out of agreements to take delivery.

Some traders in the UAE are now offering huge quantities of the rice at half the price. Traders said the departure of Iranian buyers from the market has impacted demand and brought down the price.

"Boats loaded with Indian and Pakistani basmati have been waiting to leave for Iran for some time now," said the marketing manager of a food trading company in Dubai.

He said: "Boats filled with basmati have been lying idle in Dubai and at Sharjah Cornice. Iran used to be a good market for UAE re-exporters and the fall in demand there will definitely hurt the UAE market."

He said prices of many premium basmati rice varieties have fallen by 30 per cent to 40 per cent.

An official at Dubai Municipality's Food Safety Department told Emirates Business: "The Iranian Government's decision to ban Indian and Pakistani basmati is an erratic decision based on wrong interpretation of a speech by an Indian minister appealing to farmers to stop cultivating basmati in some areas. The Iranian buyers panicked and stopped importing Indian basmati. The rice coming to the UAE is regularly checked at the port of entry for food safety."

The Indian authorities asked farmers not to sow basmati in areas that had high levels of heavy metals.

A leading co-operative in Dubai is selling two packets of Al Kubra Pure Basmati Rice, which previously cost Dh113.25 for Dh76. The offer includes two 5kg packets plus a third free packet.

The Standard Institute of Industrial Research of Iran said at the Parliament that Indian and Pakistan rice varieties were contaminated with chemicals.

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