MUMBAI: Government data released on Wednesday shows that India’s rice reserves in state warehouses surged 18% year-on-year to a record high for early June, while wheat stocks reached their highest level in four years due to increased procurement from farmers.
The record levels of rice will support India—the world’s leading rice exporter—in boosting shipments, while the growth in wheat reserves could help the central government stabilize prices later this year through open market sales.
As of June 1, total rice reserves, including unmilled paddy, reached an unprecedented 59.5 million metric tons—well above the government’s July 1 target of 13.5 million tons.
Wheat reserves were reported at 36.9 million tons, comfortably exceeding the government’s benchmark of 27.6 million tons.
“Rice inventories have built up significantly. The government needs to reduce them before the next procurement cycle begins in October,” said a New Delhi-based trader from a global trading company.
India, which contributes about 40% to global rice exports, lifted its final export restrictions on rice in March 2025, following curbs initially implemented in 2022.
According to a Mumbai-based trader, the rise in wheat stocks is largely due to higher procurement levels, positioning the government to increase sales to large buyers during the lean season.
So far this year, the Food Corporation of India (FCI) has procured 30 million tons of wheat from farmers—the highest volume in four years.
Poor harvests over the last three years and reduced FCI procurement had previously driven up wheat prices, sparking speculation that India might need to import the grain for the first time in seven years.
However, this year’s stockpile suggests that domestic demand can be met without the need for imports.
Key Terms and Concepts
What are food grain buffer stocks?
Buffer stocks are surplus reserves of essential grains like rice and wheat maintained by the government. They are crucial for ensuring food security, managing price stability, and responding to emergencies like droughts. For example, India’s 2025 rice surplus helps offset inflation. These stocks are managed mainly by the Food Corporation of India (FCI).
What is public procurement in agriculture?
Public procurement is when the government buys crops directly from farmers, usually at a Minimum Support Price (MSP). It ensures fair farmer income, builds food reserves, and supports public food programs. In 2025, India’s wheat procurement rose to a four-year high. It helps stabilize markets and avoid costly imports.
Why does India restrict or ban rice exports?
India imposes rice export restrictions to control domestic prices and maintain food security during poor harvests or inflation. This policy affects global supply since India exports 40% of the world’s rice. In 2022, export bans were used to manage shortages. These were lifted in 2025 due to record stock levels.
What is the role of the Food Corporation of India (FCI)?
FCI is India’s key food security agency that procures, stores, and distributes food grains under government programs. It plays a central role in the Public Distribution System and price control. For instance, FCI procured 30 million tons of wheat in 2025. Its actions directly impact both farmers and consumers.
How do wheat and rice stocks affect inflation?
Higher food grain stocks allow the government to release supplies into markets, curbing price surges during low-output periods. This controls food inflation and ensures affordability for consumers. In 2025, ample stocks prevented panic buying. Strategic stock management helps stabilize both domestic and international prices.
What is the Minimum Support Price (MSP)?
MSP is a government-set price guaranteeing farmers a minimum income for their produce. It encourages crop production, supports livelihoods, and boosts procurement levels. For example, higher MSPs in 2025 led to record wheat purchases. It’s a key tool in India’s agricultural and food security policy.
What is the lean season in agriculture?
The lean season occurs between harvests, typically June to October, when food supply in markets dips. It often causes price increases due to limited availability. Governments use stored grains to maintain balance—like selling wheat from stocks in 2025. Managing this phase is vital for inflation control.
How do food exports affect global markets?
When major exporters like India restrict or allow exports, it shifts global grain supply and prices. Lifting rice export bans in 2025 helped cool international food inflation. Export policies impact trade partners and global food security. For example, Africa relies heavily on India’s rice exports.
Why is agricultural procurement important in 2025?
Procurement helps build grain reserves, supports farmer income, and reduces dependency on imports. In 2025, higher wheat procurement improved India’s food stock position. It also eased concerns of supply gaps and rising prices. Effective procurement is key to economic and food stability.
How do high food reserves influence government policy?
Excess reserves enable the government to release grains in the market, adjust subsidies, or ease export controls. For instance, India’s surplus in 2025 led to resumed rice exports. It also lowers the risk of food inflation. Large stocks give flexibility in managing both supply and fiscal policy.
