Indian Rice Prices To Rise As Supply Is Impacted By El Nino

Since India increased payments to farmers, rice prices worldwide are expected to rise even higher, which are already at their highest levels in 11 years.

It occurs as El Nino threatens yields in important producers and alternative necessities become more expensive for underprivileged Asians and Africans.

In 2022, the globe exported 56 million tonnes of rice, or more than 40% of the total.

Nevertheless, low supplies mean that any reduction in shipments will increase food costs, which were already high due to the Russian invasion of Ukraine last year and unpredictable weather.

Rice prices will rise as supply is threatened by the weather and Indian farm incentives

B.V. Krishna Rao, head of the Rice Exporters Association (REA), told Reuters that India was the world's cheapest rice exporter. 

Other suppliers began boosting prices as Indian prices increased as a result of the new minimum support price.

More than 3 billion people rely on rice as a staple food, and Asia, where the El Nino weather pattern typically results in decreased rainfall, produces about 90% of the water-intensive crop.

However, the Food and Agriculture Organization's global rice price index is already over an 11-year high before the weather event may affect production.

The U.S. Department of Agriculture (USDA) had predicted near-record output from the top six producers in the world, India, Bangladesh, Indonesia, China, Thailand, and Vietnam.

According to Nitin Gupta, vice president of Olam India's rice business, "the effect of El Nino is not restricted to any one country; it influences rice output in almost all producing countries."

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