A combine harvests wheat in a tractor cart at a field near Ahmedabad, India. March 16, 2022.
India is one the top wheat producers in the world
Last week, Indian Prime Minister Narendra Modi informed Joe Biden of India’s willingness to ship food to the rest the world after supply shocks and rising costs due to the conflict in Ukraine.
Modi stated that India has “enough food” to feed its 1.4 billion inhabitants and was ready to provide food supplies to the rest of the world “from tomorrow”, if the World Trade Organization allowed.
Due to global harvest problems, commodity prices had already reached a 10-year peak before the conflict in Ukraine. According to UNFAO’s food-price index, they have risen after the war and are now at their highest level since 1990.
Ukraine war ‘catastrophic’ for global food
Russia and Ukraine are the two largest global wheat exporters. They account for around a third of world annual wheat sales. They also account for 55% global annual sunflower oil exports and 17% exports of maize or barley. UNFAO estimates that they will export together 14 million tonnes of wheat, and more than 16 million tonnes each of maize, this year.
“Russian supply disruptions and the threat of embargo means that exports must be eliminated,” says Upali Galketi Aratchilage, a UNFAO economist based in Rome. India could export more, particularly if it has sufficient wheat stocks,” states Upali Galketi Aratchilage (UNFAO economist based in Rome).
India is the world’s second largest producer of wheat and rice. It had 74million tonnes of these staples in stock as of April 1. 21 million tonnes of the staples have been stored for strategic reserve. The Public Distribution System (PDS) gives access to food and help more than 700 millions people in need.
In Patra village, Punjab in northern India, a farmer applies fertilizers to his rice plants.
Due to rising global prices and shrinking imports, India faces a shortage in fertilisers
India is also a cheap global supplier of wheat and rice. It is exporting rice to almost 150 countries, and wheat to 68. In 2020-2021, it exported 7 million tonnes worth of wheat. Officials say that traders have entered into contracts to export more than 3,000,000 tonnes of wheat between April and July in response to increasing demand on the international market. In 2021-22, farm exports surpassed a record of $50bn.
According to Ashok Gulati (a professor at the Indian Council for Research on International Economic Relations), India can export 22 million tonnes rice and 16 millions tonnes of wheat this fiscal year. It could be higher if the WTO allows government stock to be exported. He says this will reduce import burdens and help to cool global prices.
However, there are some reservations. “We have enough stocks right now. There are still some concerns and we shouldn’t get too excited about feeding the world,” Harish Damodaran (a senior fellow at Centre for Policy Research in Delhi), says.
Due to a shortage of fertilisers, the poorest are facing a food crisis
There are concerns about a lower harvest than expected. India’s new season of wheat is underway. Officials expect a record harvest of 111 million tonnes – this will be the sixth bumper crop season.
Experts like Mr Damodaran, however, aren’t convinced. According to him, the reason for lower yields is fertiliser shortages and weather vagaries such as excessive rains or severe heat in the early summer. He says, “We are exaggerating the production.” “We will find out in 10 more days.”
Experts also question the availability of fertilisers, which are a fundamental component of farming. India has a low stock of fertilisers after the war. India imports diammoniumphosphate and fertilizers containing nitrogen, sulfur, and potash. Russia and Belarus account 40% of world’s potash imports. Due to rising gas prices, global fertiliser prices have already risen.
