Government will need to take all necessary steps to ensure that India’s grain exports remain competitive

Mumbai : India’s grain exports are expected to decline in the upcoming 2023/2024 crop year due to lower production forecasts, according to a report released by the US Department of Agriculture (USDA) on November 8, 2023.

The USDA report estimates that India’s grain production in the 2023/2024 crop year will be 148.6 million metric tons (MMT), down from 157.8 MMT in the previous year. The report also lowers the USDA’s previous forecast for India’s rice production in the 2022/2023 crop year to 130 MMT, down from 136 MMT.

The lower production forecasts are attributed to the uneven distribution of monsoon rains in the 2023 season, as well as the expected arrival of El Niño in the latter part of 2023.

The lower grain production forecasts are likely to have a number of implications for India’s export market. First, they could lead to lower export volumes, as the government may need to restrict exports in order to ensure domestic food security. Second, the lower production forecasts could also lead to higher export prices, as the government may need to impose higher export duties in order to discourage exports.

India is a major exporter of rice, wheat, and other grains. In the 2022/2023 crop year, India exported a record 22 MMT of rice. However, the lower production forecasts suggest that India’s rice exports could decline in the 2023/2024 crop year.

The lower grain production forecasts are also likely to have an impact on India’s global standing as a grain exporter. India is currently the world’s largest exporter of rice and the second-largest exporter of wheat. However, the lower production forecasts could lead to India losing its position as the world’s largest exporter of rice to another country, such as Thailand or Vietnam.

The Indian government is aware of the challenges posed by the lower grain production forecasts and has taken a number of steps to mitigate them. For example, the government has increased the minimum support prices for wheat and lentils in order to encourage farmers to plant these crops. The government has also announced plans to increase imports of edible oils in order to reduce domestic prices.

It remains to be seen how the lower grain production forecasts will impact India’s export market in the long term. However, it is clear that the government will need to take all necessary steps to ensure that India’s grain exports remain competitive.