Home » World’s Food Supply Faces New Threat After India’s Rice Crop Falters

World’s Food Supply Faces New Threat After India’s Rice Crop Falters

by jackyjohn944
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World's Food Supply Faces New Threat After India's Rice Crop Falters

India, the world’s biggest exporter of rice, is experiencing a rain deficit. This has caused the planting area to shrink which in turn has led to a drop in rice production. All this raises concerns and analysts believe that rice could emerge as a next challenge for global food supply. This comes at a time when countries all over the world are scuffling with spiralling food costs and unbridled inflation.

The drop in Importing Rice From India production can trigger restrictions on exports and may complicate India’s fight from inflation. Rice is a staple food on which billions of people depend, and thus any move to  restrict the outflow of rice will have multiple implications.To safeguard food security and to control local prices, the government has already restricted the outflow of wheat and sugar from the country.

Growing Prices Of Rice

In the past two weeks, prices of some varieties of rice have soared up to 10 per cent. This is a result of deficient rain in major rice producing states like West Bengal, Odisha and Chattisgarh. The export prices are also expected to climb up due to increased demand from Bangladesh. For free-on-board basis, the prices can go from $365 a ton to $400 a ton by September.

Rice And Its Importance For Asia

Around 85 percent of all the rice in the world comes from Asia and most of it gets consumed internally. For the region, rice is of vital importance, for  both  political as well as economic stability. For India’s rice output, a lot depends on the Monsoon and how it progresses. If geographic disparities in rainfall persists, it could impact crop production adversely. Although, some experts believe there’s still time to make up for the shortfall as rain is expected to be normal for August and September which may improve crop yield.


The Present Challenges And The Optimism Ahead

The rice market presents a new challenge to India’s fight against inflation. A sharp rise in interest rates can be seen due to consumer prices jumping above the Reserve Bank of India’s upper tolerance limit of 6 percent. Interest rates may increase further as the rupee depreciation against the US Dollar continues to impact commodity prices such as fuel and vegetable oils.

India exports rice to more than 100 countries around the world. Among them, Bangladesh, China and Nepal occupy the top three positions. If we look at the bigger picture, there’s still hope when it comes to global food security as Ukraine has finally started sending outbound vessels to supply its wheat and corn. This comes after Russia removes its naval blockade after the UN’s intervention. Furthermore, the US is poised to deliver its wheat crop in the coming weeks.


As India deals with the decline in rice production, the world faces difficulties to cope. A lot of countries depend upon India’s rice yield and hence any disruption in supply is going to have a detrimental impact. Adding to the woes are the ongoing drought situation in the UK, Bangladesh’s flood recovery, the Ukraine-Russia crisis, and soaring logistics and freight costs.

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