India’s wheat harvest defies market speculation

A strong wheat harvest in India is rapidly replenishing stocks, meaning the country will be able to meet domestic demand without imports this year, contrary to market talk that it would need overseas supplies, and a potential drag on global prices.

India banned exports of the staple in 2022 and extended the prohibition as extreme heat shrivelled crops again in 2023 and 2024, draining reserves, pushing prices to record highs and fuelling speculation it would need imports for the first time since 2017.

But things are improving for the world's No.2 wheat producer, with early state inventory purchases signalling that this year's crop is about 4 million tons bigger than last year's, six industry and government officials said.

“After barely scraping through without imports in recent years, the country finally seems to be out of the woods and free from the fear of having to import wheat," said Amit Takkar, chief of New Delhi-based farm consultancy Conifer Commodities. The Food Corporation of India, the state stockpiler, has bought 29.7 million metric tons of new-season wheat from domestic farmers — the most in four years — after missing procurement targets for three consecutive years.

FCI's total wheat purchases could rise to 32 million-32.5 million tons this year, food minister Pralhad Joshi said earlier this month, adding to the 11.8 million tons in stock at the start of the marketing year on April 1. That stockpile of roughly 44 million tons would significantly exceed FCI's annual requirement of 18.4 million tons to run the world's largest food welfare programme, which provides free grain to nearly 800 million people. FCI's surging wheat stocks are sufficient to dispel the prospect of imports that has kept the global trading community guessing, the six industry and government officials said.

With the world's second-largest wheat consumer not needing imports, global prices for the grain are likely to come under pressure, as output remains strong in top exporting countries such as Argentina, Australia and Canada, while import demand from top consumer China has weakened. Global wheat prices have more than halved from the record highs of 2022, sliding earlier this month to their lowest level in nearly five years.

Better weather, higher-yielding climate-resilient seeds, and adequate soil moisture from last year's plentiful monsoon rains helped improve this year's wheat output in India. A nearly 15% rise in wheat prices over the past year — driven by consecutive poor harvests — also encouraged farmers to switch to wheat. Farmers in the central state of Madhya Pradesh, known for premium wheat that goes into pizzas and pastas, said crop yields were higher this year thanks to a milder March. "The weather was better this year compared to last year," said farmer Sunil Dubey, as he steered his tractor trolley brimming with brown sacks of wheat into the dusty, bustling wholesale market of Indore.

Dubey and many other farmers have sold their entire harvest to the FCI this year. FCI's robust stockbuilding means that it can release wheat onto the open market in the event of a domestic price spike.

In the fiscal year to March 2024, the FCI released more than 10 million tons of wheat into the open market — a record — to tame rising prices. However, lower inventories prevented it from selling large quantities the following year, and Indian wheat prices jumped to an all-time high in early 2025. The government is now far more confident about domestic wheat supplies and prices.

India has no plans to lower or remove the 40% wheat import tax, nor is it considering importing wheat through diplomatic channels, as it had discussed earlier, said a senior government official.

"Because of good production and procurement, we have ample quantities in hand," said the official who declined to be named, citing government rules. "There will not be any imports."

At the same time, India is not considering allowing exports, the official said, preferring instead to build stocks. The government has forecast this year's output at a record 115.4 million tons, although the Roller Flour Millers Federation of India has pegged production at 109.63 million tons. Both estimates were made before the April harvest. In 2024, India produced 105.85 million tons of wheat, according to the flour millers' body, below the government's 113.29 million tons figure.

Trade and industry officials have in recent years said the farm ministry's wheat output estimates are overly optimistic and create market uncertainty. “Despite our conservative estimate, we know that production will be around 4 million tons higher than last year," said Navneet Chitlangia, president of the Roller Flour Millers Federation of India.