At an Asia Society event in New York on Monday (28 September 2026), External Affairs Minister S. Jaishankar said something that is rarely heard in diplomatic speeches. He said that a food crisis would probably arrive in the coming months due to the combined effects of grain supplies issues from the Black Sea, a fertiliser supply crunch and a super El Niño and continuing geopolitical tension along the world’s major sea routes.
The war between Russia and Ukraine, which has been going on for the past four to five years, has impacted global supply chains. On the other hand, tension in the Middle East and the threat to the movement of ships in the Strait of Hormuz have pushed up fuel and fertiliser prices once again.
The direct impact of this multi-dimensional crisis is being felt in India too. While there is uncertainty in the international market on one side, the behaviour of the weather and the production figures at home are raising fresh worries on the other. According to a Reuters report, India’s paddy production in 2026 could fall by about 10 million tonnes, which would be one of the biggest declines in the past two decades.
The question that arises is whether the buffer stock held in government warehouses can save India from this global storm. After rice, what will be the impact on pulses, edible oils, wheat and sugar? Let us understand every layer of this crisis in detail.
External Affairs Minister S. Jaishankar said in plain words that the global economy is currently under pressure on several fronts at once. Energy, food, fertiliser and finance are the four pillars on which every country in the world rests, and all four are under serious strain at this moment.
Jaishankar said, “Conflicts in the world’s major grain-exporting regions, especially the disruptions in the Black Sea region, are putting heavy pressure on the availability of foodgrains in the global market. Along with this, the shortage of fertilisers and weather events such as Super El Niño have made the situation extremely fragile.”
Jaishankar also drew attention to the fact that whenever a major war or crisis breaks out anywhere in the world, capital starts moving out of the international market towards markets considered safe. This hits the economies of developing and poor countries from all sides. He appealed to global policymakers to understand the international impact of their decisions, because the protectionist policies of one country can become the cause of hunger in another part of the world.
To verify the External Affairs Minister’s warning, when the data of the Food and Agriculture Organization (FAO) of the United Nations, the World Bank and the International Grains Council (IGC) are reviewed, clear stress is visible in the Global Food Balance Sheet.
The FAO Food Price Index stood at 133.3 points in August 2026. This is 2.5 points, or 1.9 per cent, above the revised July level (130.8). According to Reuters, this is the highest level since November 2022. Even so, it is 16.8 per cent below the record peak of March 2022. In other words, the level is not that of a 2022-type crisis, but the trend is upward. In January this year the index was at 123.9 points, the lowest since August 2024. From January to August it has risen by about 7.6 per cent (this is a calculation based on the two figures).
(Understanding the graph: This is the FAO Food Price Index, which shows the average of international prices of food items across the world. The three bars represent three months: 123.9 in January, 130.8 in July and 133.3 in August. The taller the bar, the costlier the items. Please note that the lower part of the graph starts not from 0 but from 100 points, so that the difference is clearly visible. As a result, the ratio of the bars’ heights looks bigger than the actual increase. The actual increase from January to August is about 7.6 per cent.)
Cereals: The index stood at 116.3 points, 2.2 per cent higher than July and the highest since May 2024. Wheat rose by 2.6 per cent, and the reason given was disruption of exports from the Black Sea region. The rice picture is less heated: the FAO rice index rose by only 0.5 per cent in August.
Vegetable oils: 196.9 points, the highest since June 2022, driven by the prices of palm and soya oil.
Sugar: 106.4 points, 11.9 per cent higher than July and the highest since June 2025. The reasons cited include hot and dry weather in the European Union and parts of Asia, lower production in Brazil, and India’s decision to allow duty-free imports of raw sugar.
Dairy: Most items rose, but dairy is still about 22 per cent below the level of a year ago.
This was the third consecutive month in which the index rose, and prices moved up in all five categories. According to FAO Chief Economist Maximo Torero, climate shocks, geopolitical tension and held-up transportation together are tightening supply expectations.
The other side of the story lies in production and stocks. In 2025/26, world cereal production rose by 6.1 per cent to a record 3,043 million tonnes, and global stocks rose by about 9.5 per cent. According to FAO’s estimate, the stock-to-use ratio in 2025/26, that is, the share of stocks relative to total consumption, was 31.8 per cent, the highest since 2001.
Now to 2026/27. According to Reuters, FAO has cut its estimate of global cereal production for 2026 by 3.4 million tonnes from July, to 2,980 million tonnes. This is 2.0 per cent lower than in 2025 and the biggest annual decline since 2018. Even so, according to reports, it will still be the second-largest crop on record. The estimate of closing stocks for 2026/27 has been trimmed by 1.1 per cent to 947.2 million tonnes, which is only slightly above the previous season.
(Understanding the graph: The left bar shows the record world cereal production of 2025, 3,043 million tonnes. The right bar shows FAO’s latest estimate for 2026, 2,980 million tonnes, that is, about 2 per cent lower. The difference looks small, but according to FAO this is the biggest annual decline since 2018. Even so, production is still at a very high level. This graph starts from 0, so the ratio of the heights is true to scale.)
There is a subtlety in this picture. The estimate of wheat stocks has gone up, but the reason is not a good one. Stocks in Russia and Ukraine are expected to rise because of disruption in shipping. That is, the grain exists, but it is stuck in places from where it is difficult to move out. In the United States, too, maize production was cut by 213 million bushels in the September WASDE report. In contrast, the estimate of global rice supply was raised because of India’s opening stocks, although production has fallen year on year. And according to the United States Department of Agriculture (USDA), in 2026/27 India’s wheat stock will be more than 10 per cent of the world’s total closing stock, even as the stocks of most big exporters are shrinking. According to USDA’s August report, the world’s closing stock of wheat in 2026/27 is estimated at 273.3 million tonnes. The numerical data from the September report are yet to be examined separately.
The numbers do not show a picture of “famine” or “shortage”. They show a picture of stress: prices are at a three-to-four-year high, production is coming down slightly from the record, and stocks are still much higher than in the 2000s. The real risk lies in where the grain is and what obstacle stands in the way of its movement.
According to the Reuters report, Krishna Rao, President of the Rice Exporters Association, has assessed that production this year could be about 10 million tonnes lower than last year’s record of 154 million tonnes. On this reckoning, production will be about 144 million tonnes, a fall of about 6.5 per cent. This would be the biggest fall since the El Niño drought of 2009-10, and, according to industry estimates, the first in a decade. This is not the government’s official estimate. The government’s First Advance Estimate is yet to come.
The USDA’s September report also points in the same direction. It has cut its estimate of world rice production for 2026-27 from 537.27 million tonnes in August to 533.85 million tonnes. S&P Global’s estimate is somewhat different: according to it, world rice production could be about 536.4 million tonnes, that is, about 9 million tonnes lower. The estimates differ, but the direction is the same in all of them.
Rainfall in India since 1 June has been about 15 per cent below normal, and in some rice-growing states the deficit has gone as high as 42 per cent. The problem is not only of quantity but also of distribution. According to a report published citing Reuters, even in areas where total rainfall looked close to normal, heavy showers after long dry spells put pressure on the crop.
In mid-July, Down To Earth had reported that 397 of the country’s 741 districts had below-normal rainfall, and the shortfall was especially in the plains of Uttar Pradesh, Bihar and Jharkhand. According to the Agriculture Ministry, by 28 August the area under paddy had fallen by 3.35 per cent to 414.10 lakh hectares, with states such as Karnataka, Telangana, Jharkhand and Madhya Pradesh affected. By 11 September, the area under kharif paddy was 42.68 million hectares, about 4 per cent lower.
According to Rao, the dry spells of the past few weeks have reduced yield prospects in several southern and eastern states. The next risk is to the Rabi crops, that is, winter paddy. Nitin Gupta of Olam Agri India cautioned that, because water in reservoirs is below normal, the area sown to winter paddy could shrink. The El Niño trend is also linked to this. On 10 September, the Climate Prediction Center of the US weather agency NOAA said that El Niño is strengthening and that the probability of it turning “very strong” this autumn-winter is more than 90 per cent. Details of this follow in later parts of this article.
Records in stocks call for caution
According to Reuters, as of 1 September rice in government stocks (including unmilled paddy) stood at a record 59.6 million tonnes, against the government’s buffer target of 10.3 million tonnes for 1 October. That is, stocks are nearly six times the target.
Caution is needed in reading this figure, because it includes paddy that is yet to be milled into rice. In February, the FCI had 74.04 million tonnes of rice, of which more than 60 million tonnes was in the form of paddy. That is, the share of ready rice is lower than this.
This stock did not build up overnight. The FCI and state agencies buy about 52-53 million tonnes of rice (in rice-equivalent terms) at MSP every year, while 36-38 million tonnes is distributed for the free ration scheme (PMGKAY). That is, a surplus has been building up structurally every year. In October 2025, the FCI’s rice stock was 36.3 million tonnes, about two and a half times the buffer, and concern was being raised over its storage cost.
In view of this surplus, the Open Market Sale Scheme (OMSS) 2026-27 provides for FCI rice to be given to ethanol distilleries till 31 October at Rs 2,320 per quintal. This is even below the MSP of paddy. The policy also speaks of accounting for PDS requirements, buffer norms and a separate reserve of 30 lakh tonnes for emergencies. With fears of falling production, this provision deserves to be watched going forward.
In India, the main production of paddy takes place in the monsoon-dependent kharif season. More than 70 per cent of the country’s total rice production comes from 8-9 major states. These states differ in the extent of production, the sowing area, the sources of irrigation and the risks that farming faces.
West Bengal, Uttar Pradesh and Bihar (eastern and northern India): West Bengal and Uttar Pradesh are among the largest rice-producing states. West Bengal produces an average of 16.50 to 17.20 million tonnes of rice on about 5.50 million hectares, relying on canals, tubewells and monsoon rain. However, cyclonic storms, excessive rain and floods damage the crop here the most. Uttar Pradesh produces 19.80 to 20.93 million tonnes of rice on an area of about 5.86 million hectares; it depends on tubewells and the canal network, but uneven rainfall and drought-like conditions in eastern UP remain a challenge. Bihar, for its part, produces 7.50 to 8.20 million tonnes on 3.21 million hectares, where floods in the north and drought in the south affect the crop.
Telangana and Andhra Pradesh (southern India): In southern India, Telangana and Andhra Pradesh hold a prominent place in paddy production. Telangana produces 16.00 to 17.50 million tonnes of rice on about 4.81 million hectares with the help of canals and tubewells, but the main concerns here are the continuous availability of electricity and the falling groundwater level. Andhra Pradesh, on the other hand, produces 8.50 to 9.20 million tonnes of rice on 2.16 million hectares on the strength of the Krishna-Godavari delta canals, where coastal cyclones and inter-state water-sharing disputes affect production.
Punjab and Haryana (north-western irrigated belt): Punjab and Haryana deliver bumper yields on the strength of their robust irrigation networks. Punjab produces 13.50 to 14.50 million tonnes of rice on about 3.00 million hectares, where 99 per cent of irrigation is through tubewells and canals. However, serious depletion of groundwater has become the biggest crisis here. Haryana produces 5.40 to 5.80 million tonnes of rice on 1.35 million hectares, entirely with irrigated sources, where production fluctuates because of the rising and falling area under Basmati.
Chhattisgarh and Odisha (monsoon-based states): Chhattisgarh and Odisha depend mainly on monsoon rain, though irrigation has been expanding. Chhattisgarh produces 8.50 to 9.80 million tonnes on 3.82 million hectares, supported by strong state procurement policies. Odisha produces 8.20 to 9.10 million tonnes of rice on 3.94 million hectares with the help of rain, river water, and canal systems, where the double blow of coastal storms and drought affects the crop cycle.
According to the official PIB release, India achieved a record total foodgrain production of 357.73 million metric tonnes (MMT) in the agricultural year 2024-25. Out of this, national rice production reached a record high of 150.18 million tonnes (1,501.8 lakh tonnes). The major contribution to this national production comes from key states including Uttar Pradesh, Telangana, and West Bengal. Furthermore, the budgetary allocation to the Department of Agriculture and Farmers Welfare has seen a steady increase, rising from Rs 1,27,290.16 crore in 2025-26 to Rs 1,30,561.38 crore in Union Budget 2026-27 to support resilient agriculture systems and production.
For the 2026-27 kharif marketing season, the Centre has set a paddy procurement target of 708.64 lakh tonnes, which is lower than the recent actual level. According to the report, actual procurement has been 720.74 lakh tonnes (in figures up to 5 August). Before that, procurement was 708.85 lakh tonnes in 2024-25 and 689.56 lakh tonnes in 2023-24. The reason given for lowering the target is the smaller area under paddy.
The MSP of common paddy for 2026-27 has been fixed at Rs 2,441 per quintal, against Rs 2,369 in 2025-26. That is an increase of about 3 per cent. For farmers there is one more aspect: those growing premium varieties expect better prices in the market, which could mean fewer sales to government agencies.
India accounts for more than 40 per cent of the world’s rice exports. Between January and June 2026, exports rose by 5 per cent to 12.27 million tonnes (against 11.68 million tonnes in the same period last year). According to Reuters, because of its large stocks India can sustain strong exports without imposing fresh curbs. The effect is visible in the market: expectations of a smaller crop have supported domestic prices, and export prices are at their highest in more than a year.
The past record also needs to be put on the table. According to the Food Security Portal, in 2023, in view of rising food inflation, a ban was imposed on exports of non-Basmati white rice, a 20% duty on parboiled rice and a minimum export price on Basmati. In June 2023, citing fears of lower production, the Centre stopped sales of rice and wheat to states under the OMSS (Open Market Sale Scheme), which also triggered a political controversy. That is, there is a precedent at the level of policy. It should be read only as context, not as a prediction.
Retail inflation in August was 4.82% (4.45% in July), that is, a rise for the third consecutive month. Food inflation was 5.95% (5.52%in July), and rural food inflation was 6.13%. These figures are based on the new CPI series (base year 2024). A separate figure for retail inflation in rice is not yet available. Concerns over agriculture and the monsoon have raised the apprehension that prices of rice, pulses and other agricultural products could be affected going forward.
For the poor consumer, the buffer matters here. The government had decided to provide free foodgrain to 81.35 crore beneficiaries for five years from January 2024. That is, the rice and wheat received through rations are largely insulated from price fluctuations. The impact will be greater on families that buy a part of their grain from the open market.
The picture for farmers differs by region. In the eastern and southern states where rainfall was deficient, the fall in yield will hurt farmers directly. A large part of MSP procurement generally comes from only a few states. So the existence of stock in the country and the protection of the income of farmers in a particular region are two different questions.
On a rough reckoning, the gap between procurement and distribution every year comes to about 15 million tonnes, while this year’s estimated decline is about 10 million tonnes. Note that these two figures come in different units (paddy and rice), so the comparison is a rough one. Even so, the indication is clear: a one-year fall by itself does not become a food-security crisis. There could be three routes to a crisis, and these are what need to be watched:
A second year: If El Niño continues till 2027 and the area under Rabi paddy also shrinks, a one-time decline becomes a two-year one.
Policy response: Even when stocks are safe, steps such as a ban on exports or stopping OMSS may hold down domestic prices, but they affect other countries, especially importers in Africa and Asia.
Distribution and regional disparity: Small farmers in the eastern states are directly hit by lower yields, while the benefits of procurement go to other regions.
(This section is analysis, not a claim made by the sources.)
In July 2026, the Black Sea region became a battlefield once again. According to the American think tank CFR, three years of calm were broken and ports began to shut just before the harvest season. According to Bloomberg, since July Russia and Ukraine have been attacking each other’s ports, terminals and ships, and more than 70 per cent of Russia’s grain exports go out through this very sea region.
According to the Moscow Times, by 17 August more than 90% of Russia’s grain export capacity in the Azov-Black Sea region had come to a halt. Novorossiysk’s grain terminals were shut; they alone handle about 25 million tonnes of Russian grain. According to Andrey Sizov of SovEcon, activity at Odesa’s three terminals is almost nil, whereas more than 90% of Ukraine’s wheat exports in the first half of this year went through Odesa. Analysts estimate that Russia’s wheat exports in July-September will be only 5.6 million tonnes, against 11.3 million tonnes last year. Russia and Ukraine together account for more than a quarter of the world’s wheat exports (one-third according to the World Food Programme, WFP). According to some reports, wheat futures have risen to a three-year high.
The grain is there, but stuck: Russia’s crop this year is reported at about 140 million tonnes. Farmers’ stocks are rising and buyers are few. This is what showed up in FAO’s data, where wheat stocks in Russia and Ukraine are expected to rise because of disruption in shipping. Russia is looking for export options through the Baltic route and the Far East. According to a CSIS estimate, about 10 million tonnes could move out through the Baltic terminals, which is roughly a fifth of the 46 million tonnes that left through the Azov and Black Sea in 2025-26. But according to CFR, Ukrainian drones had reached Ust-Luga in the Baltic in early September, which is also Russia’s fertiliser hub.
The Turkish corridor: Turkey has sent both sides a draft on the lines of the 2022 ‘Black Sea Grain Initiative’. Foreign Minister Hakan Fidan said on 31 August that the plan is ready and talks are on with both sides. The reason is clear: since the end of June at least 25 Turkish-owned ships have been targeted. But no agreement has been reached so far. According to reports, Russia has publicly rejected the idea of a separate ‘Black Sea ceasefire’, and Turkish President Erdogan is reported to be due to speak to Putin about it in November. That is, till the end of September the corridor remains only a proposal.
Impact on Africa: The countries at greatest risk are those that depend on these two countries. Citing S&P Global, Egypt, the world’s largest wheat importer, took more than 82 per cent of its imported wheat from Russia and Ukraine in the first half of this year. It is now buying costlier French wheat. Bangladesh has bought wheat from Bulgaria, and France is about to ship wheat to Sudan for the first time in 18 years. According to the WFP, the cost of a basic meal in Sudan has risen by about 40 per cent since February, in which fuel prices also have a hand.
What it means for India: India does not depend directly on the Black Sea, but it is affected in three ways: sunflower oil, fertiliser, and the pressure of global wheat prices. Meanwhile, India’s own wheat is now open for export.
The Strait of Hormuz, in fact, was closed on 28 February 2026, as soon as the war with Iran began. Though official announcements may not have said so, the moment bombs started started, shipping on the key global route was in danger. According to the International Food Policy Research Institute (IFPRI), about one-third of the world’s seaborne fertiliser trade came under risk. This shut off the sea route for about 21 million tonnes of annual urea export capacity and about 4 million tonnes of DAP capacity of the Gulf region. Gulf countries supply 23% of the world’s DAP exports.
According to IFPRI, by April the global price of urea had nearly doubled and that of DAP had risen by about 35 per cent. According to a BISI report, urea rose from 400 dollars to above 850 dollars per tonne in April and then eased somewhat. By July, global urea prices had come back to around pre-war levels, but in many African countries urea is still very expensive in local markets. One more figure: before the war, Gulf countries supplied about 43% of the world’s urea exports and 44% of sulphur exports. Urea imports from the Gulf fell by about 85%, yet the world’s total fertiliser imports fell by only about 6%. That is, the world has made up for much of it from other sources.
The biggest risk is the next crop: BISI assesses that the effect of lower fertiliser use in Africa will show up late in food prices, and the peak of food inflation could fall between the end of 2026 and mid-2027, especially in maize markets. ISS has reported that costs for grain farmers in South Africa have risen by up to 35 per cent. Analysts also warn that even if the disruption at Hormuz eases, prices could stay high because of lower fertiliser use. On the latest situation, citing Kpler data, only four cargo ships passed through Hormuz on 14 September, against a daily average of about 125 before the war. This is for all cargo, not just fertiliser.
India’s picture: According to government data, on 22 June the country’s total fertiliser stock was 196.08 lakh tonnes, higher than 168.67 lakh tonnes at the same time last year. Consumption has also risen: from 1 March to 21 June, sales were 153.4 lakh tonnes, against 140.2 lakh tonnes last year. On 29 September, Agriculture Minister Shivraj Singh Chouhan said there would be no shortage of fertiliser in rabi. The states have indicated a demand of about 380 lakh tonnes of fertiliser for 2026-27, against an opening stock of 163 lakh tonnes. (The difference between these two numbers is not a “deficit”. The rest is to be met from domestic production and imports.) On paper, supply looks fine. The real test will come at the time of rabi sowing, when demand for DAP is at its peak and government claims will be matched against availability on the ground.
What scientists say: ‘Super El Niño’ is not an official category, but NOAA’s figures tell a story close to it. On 10 September, NOAA’s Climate Prediction Center (CPC) said that El Niño is strengthening and that the probability of it becoming ‘very strong’ in the Northern Hemisphere’s autumn-winter of 2026-27 is more than 90%. The probability of a ‘historic’ event in October-December, above any El Niño since 1950, that is, +2.5°C or more on the three-month RONI value, is 75%. According to Columbia University’s IRI, all 22 models agree that it will strengthen further. The probability of El Niño is 100 per cent till February 2027, falling to 61 per cent by mid-2027. But NOAA also says that impacts are not guaranteed.
State of the monsoon: According to data from the India Meteorological Department (IMD), a deficit of over 12% against the long period average was recorded in the June-September monsoon up to mid-September. This is higher than the 10% deficit indicated in the May forecast. If it stays this way, it will be one of the weakest monsoon seasons since 2009, when the deficit was 18%. According to one estimate, the deficit could end between 13 and 16% by the close of the season. The IMD will release the final figure after the season ends. According to the 24 September report of the Central Water Commission (CWC), water in the 178 major reservoirs is about 70% of total capacity, against a 10-year average of 76.62% and 79% at the same time last year.
(Understanding the graph: This shows the water stored in the country’s 178 major reservoirs as a percentage of their total capacity. The left bar shows the level at the same time last year, 79%. The middle bar shows the 10-year average, 76.62%. The orange bar on the right shows the level on 24 September 2026, about 70%. That is, this year the reservoirs are about 9 points below last year and about 6.6 points below the 10-year average. This level of water is important for rabi irrigation. This graph starts from 0.)
Where the impact will hit: On rice in kharif, and thereafter on Rabi sowing through water and soil moisture. It is for this reason that the government has set the foodgrain production target for 2026-27 at 373.93 million tonnes, which is 2.63 million tonnes lower than the estimated 376.56 million tonnes for 2025-26. According to Chouhan, reservoirs, groundwater and soil moisture were taken into account while setting the target. By 18 September, kharif sowing was 110.39 million hectares, about 1.5 million hectares lower than last year. The area under rice fell by 3.7 per cent.
Edible oil, where import dependence is the highest: India imports about two-thirds of its vegetable oil requirement. These are mainly palm, soyabean and sunflower oils, which come from Malaysia, Indonesia, Argentina, Russia, Ukraine and Brazil. Vegetable oil prices have risen by about 20% in the past one year. On 23 September, soyabean oil was selling at Rs 167 per kg (14% higher), sunflower oil at Rs 194 (19.5% higher) and palm oil at Rs 154 (16.3% higher). According to the Solvent Extractors’ Association, the oil import bill in this marketing year (till October) could rise by 9% to Rs 1.75 lakh crore. The reasons are higher volumes and a weaker rupee.
(Understanding the graph: The three bars show the retail prices of three edible oils, in rupees per kg, on 23 September 2026. Palm oil Rs 154, soyabean oil Rs 167 and sunflower oil Rs 194. Below each bar, in brackets, is written by how much it has become costlier compared with a year ago: palm 16.3 per cent, soyabean 14 per cent and sunflower 19.5 per cent. The biggest rise is in sunflower oil, a major source of which is the Black Sea region. This graph starts from 0.)
The government has reduced import duty from 24 September. The basic customs duty on crude palm and soyabean oil has been cut from 10% to 5% (the total duty, with all levies added, from 16.5% to 11%). The duty on crude sunflower oil has gone from 10 per cent to zero, and on refined palm-soyabean from 32.5% to 27.5%. The Food Ministry has asked companies to pass this benefit on to consumers. But how much relief is felt will depend on international prices, the rupee and freight. There is also a question of balance: cheaper imports put pressure on domestic oilseed farmers. In FAO’s August data, the vegetable oil index was at its highest level since June 2022.
Pulses, where import dependence is lower but the impact is sharper. In 2024-25, India imported about 7.3 million tonnes of pulses. These included 2.2 million tonnes of yellow/white peas (mostly from Canada and Russia), 1.6 million tonnes of chana, 1.2 million tonnes of arhar, 1.2 million tonnes of masoor and 0.8 million tonnes of urad. India imports about 18-20 per cent of its annual consumption of pulses, and dependence is highest in tur and urad. At present there is a 30 per cent duty on yellow peas and 10 per cent on masoor. The government has launched a six-year mission for self-reliance in pulses by 2029. According to a September report, in view of the risks of El Niño and a weak monsoon, the government has built a record buffer of 4.5 million tonnes of pulses, and duty-free imports of tur and urad will continue till March 2027. The area under pulses in kharif has fallen very little so far: by 14 August, only about 35,000 hectares.
Here India’s position is the reverse. According to the USDA, India is estimated to produce a record 121 million tonnes of wheat in 2026/27, the fourth consecutive record. Food Secretary Sanjeev Chopra said that domestic wheat prices are subdued. It is for this reason that on 24 August 2026 the government lifted the ban on exports of wheat and wheat products. The ban had been imposed in May 2022. According to the Secretary, opening up exports will improve domestic prices and lead to good sowing in Rabi. According to the BusinessWorld report, wheat stock is currently about 48 million tonnes, against a buffer requirement of 27.6 million tonnes. Meanwhile, Chicago wheat futures rose by more than 17% from early July to the end of August.
Where the risk lies: Three things will be decided before Rabi sowing (October-November). First, water: reservoirs are below average, and El Niño is expected to intensify in winter. Second, fertiliser: the figures on paper are fine, but the actual availability of DAP in Rabi, state by state, is yet to be tested. Third, acreage: according to the USDA, India’s wheat acreage has reached a record 33.5 million hectares and maintaining this level will not be easy amid a shortage of water and fertiliser. The reverse is equally true: stocks are so large that even a weak Rabi will not create a shortage immediately.
At the start of the report, the question was whether a grain supply crisis is coming to the world and where India stands. The numbers answer in two parts. In grain, India is strong. In fertiliser, oil and water, not so much.
Grain stocks: As of 1 September, rice in government stocks (including unmilled paddy) stood at a record 59.6 million tonnes, against a buffer target of 10.3 million tonnes. Wheat stock is about 48 million tonnes, against a buffer requirement of 27.6 million tonnes. According to the USDA, in 2026/27 India’s wheat stock will be more than 10 per cent of the world’s total closing stock.
Production: A record 121 million tonnes of wheat is estimated this year, the fourth consecutive record. In rice, a fall of about 10 million tonnes is feared, but that is from last year’s record of 154 million tonnes, so production will remain at a high level even after the fall.
Protection for poor families: A scheme to provide free foodgrain to 81.35 crore beneficiaries for five years from January 2024 is under way. Ration rice and wheat are largely shielded from market fluctuations.
Export options: There is currently no ban on rice exports, and from 24 August wheat exports have also been opened. Stocks are large enough to give the government room to choose its policy.
Edible oil: The country imports about two-thirds of its requirement of oil. Oil prices have risen by about 20 per cent over the year, and the import bill could go up to Rs 1.75 lakh crore. Duty was cut on 24 September, but how much relief it brings depends on international prices and the rupee.
Pulses: About 18-20% of consumption comes from imports, and dependence is higher in tur and urad. The good news is that, according to one report, the government has built a record buffer of 4.5 million tonnes.
Fertiliser: On paper, supply looks fine, but the states have asked for about 380 lakh tonnes of fertiliser for 2026-27, against an opening stock of 163 lakh tonnes. The rest is to be met from production and imports, and a large part of the imports is linked to the Gulf region, where Hormuz is still at risk. The real availability of DAP at Rabi sowing is the biggest question here.
Water: The monsoon was about 12-15% deficient, and on 24 September, water in the major reservoirs was about 70% of capacity, against a 10-year average of 76.62%. According to NOAA, the probability of El Niño turning ‘very strong’ in winter is more than 90%. This is the biggest uncertain part of the rabi crop.
Foreign exchange and oil: This is the link that ties the other things together. According to Bloomberg, in the week ended 18 September India’s foreign exchange reserves fell by 14.88 billion dollars to 765.9 billion dollars. This is the biggest weekly fall since November 2024. The reason was that, with oil prices rising, the Reserve Bank sold dollars to support the rupee. Earlier, reserves had touched a record 785.7 billion dollars. The reserves are still large, but a weak rupee and costlier oil directly make the import bills of edible oil, fertiliser and pulses dearer, that is, the very items in which India depends most on imports.
Inflation: In August, food inflation was 5.95% and rural food inflation 6.13%, higher than in July. Stocks do not directly stop this effect, because open-market prices move separately.
First, the government has both a surplus and uncertainty. On one side are steps such as selling FCI rice for ethanol at Rs 2,320 per quintal and opening wheat exports. On the other, the production target has been lowered and the procurement target set a little lower. Second, past experience shows that in 2023, in view of inflation and elections, exports were banned and OMSS sales were stopped. Given the present stocks, such a step does not look necessary, but policy will move between these two pulls.
External Affairs Minister S. Jaishankar’s warning is clear evidence that the world is passing through an extremely uncertain phase. India has a strong buffer stock of rice and wheat and the shield of the ration system, which keeps the country fully safe from immediate hunger. But edible oil, pulses, costlier fertiliser and the unseasonal heat arising from climate change are challenges for which India will have to take big and tough strategic steps in its agricultural policy starting today.
In fact, a crisis is not created by a one-year fall. It is created when the fall continues into a second year, when the supply of inputs breaks down, or when policy steps shake both prices and the external market. In the next few months, it is on these that we will have to keep our eyes.
As India marches toward 900 GW of non-fossil capacity by 2035, generation is no longer the sole metric of grid resilience. This final instalment of our energy storage series dissects the utility-scale Battery Energy Storage System (BESS) revolution. From the mechanics of LFP enclosures to the historic ₹1.86 lakh crore Green Energy Corridor Phase-III mandate, we map the 92 GWh national pipeline turning midday solar surges into dispatchable evening power.
To absorb massive solar energy surges and prevent evening blackouts, India is fundamentally re-engineering its topography. This second instalment of our energy storage series dives into Pumped Hydroelectric Storage—exploring the mechanical genius of reversible pump-turbines, the strategic pivot to off-river closed-loop systems, and the 15 GW pipeline of mountain-sized “water batteries” currently under construction across the subcontinent.
As India charges toward 500 GW of non-fossil capacity by 2030, solar surges and nighttime wind variations present a critical operational test for the national grid. Beyond generation capacity, the real crucible of the clean energy transition lies in storage. This first instalment of a three-part series examines the five technical storage vectors identified by the Union government—from closed-loop mechanical systems to chemical vectors—and the pan-Indian transmission network engineering 24×7 dispatchable power.
Selected issues, clear explanations and thoughtful perspectives—delivered when we publish.
