{"id":3743,"date":"2026-11-03T16:04:01","date_gmt":"2026-11-03T11:04:01","guid":{"rendered":"https:\/\/ipp-news.com\/?p=3743"},"modified":"2026-11-03T16:04:01","modified_gmt":"2026-11-03T11:04:01","slug":"from-grains-to-chicken-and-milk-india-faces-prolonged-food-inflation","status":"publish","type":"post","link":"https:\/\/ipp-news.com\/?p=3743","title":{"rendered":"From grains to chicken and milk, India faces prolonged food inflation"},"content":{"rendered":"
\n

Indian farmer Amarsingh Gushinge wants to sow wheat and chickpeas in coming weeks to capitalise on attractive prices, but dwindling water supplies after below-average monsoon rains are preventing him from planting either crop.<\/strong><\/p>\n

Like Gushinge, millions of farmers, especially in southern and western India, are facing water shortages as they prepare to plant winter crops.<\/p>\n

\u201cThere\u2019s not enough moisture in the soil to sow \u200bthe next crop, and no money left to do so either,\u201d said Gushinge, 78, at Rajewadi village, about 400 km east of Mumbai.<\/p>\n

The Jalna district around his village \u200chas received about 48% less rain than average this year, the local weather office has said.<\/p>\n

A weak monsoon mean farmers will have to sow winter crops under less favourable conditions, raising the risk of stunted growth and lower yields.<\/p>\n

Lower crop yields could further stoke food inflation, with prices of sugar, pulses, wheat and rice already climbing amid a severe El Ni\u00f1o. Onions, ubiquitous in Indian kitchens and widely used in curries, as well as milk and poultry products, are also becoming more expensive.<\/p>\n

A spike in \u200bprices of staples can anger millions of Indians – increases in onion prices have ousted state governments in elections in the past.<\/p>\n

Higher food prices could further weaken discretionary consumption across the economy, with the weakest monsoon<\/a> \u200brains in more than a decade already dampening rural demand<\/a> and dragging down sales of tractors and farm equipment.<\/p>\n

Food inflation could reach around 10% in the October-December quarter, \u2060said Devendra Pant, chief economist at India Ratings and Research, citing a combination of weak rains, higher global prices and rupee depreciation.<\/p>\n

In September, annual retail food inflation accelerated to 7.74%, pushing headline inflation to 5.54%, close to \u200bthe Reserve Bank of India\u2019s upper tolerance limit of 6%.<\/p>\n

Higher food prices will likely prompt the central bank to raise interest rates by a further 50-75 basis points, as it risks feeding into broader price pressures, Pant \u200bsaid.<\/p>\n

He said he expects the central bank to raise rates for a second consecutive time at its December meeting, after its first hike in October.<\/p>\n

<\/a>Protein inflation<\/strong><\/h3>\n

Protein has been a key driver of price increases and could prove difficult to bring down, economists said.<\/p>\n

The central bank\u2019s September Monetary Policy Report said animal protein and spices accounted for nearly half of the 200-basis point rise in food inflation between March and August, driven by higher feed and fodder, transport, packaging and energy costs, as well as \u200bbird mortality after a heat wave.<\/p>\n

In September, meat inflation eased to 8.7% from 12.0% in August, largely due to a high base, while inflation in milk, other dairy products and eggs rose to 5.1% from 4.8%.<\/p>\n

Animal \u200bfeed, mainly corn and soybean, accounts for 60%-70% of poultry production costs, said Uday Singh Bayas, president of poultry equipment makers\u2019 body IPEMA-Poultry India.<\/p>\n

Poultry producers have yet to fully pass on higher feed costs, and broiler prices could rise from \u200cJanuary as higher \u2060costs and tighter supplies put further pressure on the market, said Uddhav Ahire, chairman of the Anand Agro Group.<\/p>\n

Pulses, poultry and dairy are key sources of protein in India. Prolonged protein inflation could hurt lower-income households and force them to alter their diets, with implications for long-term health, said Madan Sabnavis, chief economist at Bank of Baroda.<\/p>\n

<\/a>Limited relief<\/strong><\/h3>\n

Sugar output is likely to fall short of domestic consumption for a second consecutive year and may recover only in late 2028 if rains are favourable in 2027, said Rahil Shaikh, managing director of Mumbai-based trader MEIR Commodities India.<\/p>\n

Sugar prices have risen nearly 30% over the past year, prompting the government to allow duty-free imports of \u200b1 million metric tons to help bridge a shortfall, \u200bwith consumption exceeding 29 million tons this year against output \u2060of less than 27.5 million tons.<\/p>\n

But global prices are higher than domestic rates, limiting the impact of imports and making a return to last year\u2019s price levels unlikely, Shaikh said.<\/p>\n

While India can turn to imports of sugar, vegetable oils and pulses to offset domestic production shortfalls, higher global prices<\/a>, a weaker rupee and rising freight costs \u200bare making overseas supplies more expensive.<\/p>\n

El Ni\u00f1o is also affecting farm production in other countries, while the Russia-Ukraine war has hit grain and sunflower oil supplies \u200bfrom the Black Sea region.<\/p>\n

These \u2060factors are pushing up prices of vegetable oils, said Sandeep Bajoria, chief executive of Mumbai-based brokerage Sunvin Group.<\/p>\n

India holds surplus stocks of rice and wheat, but prices continue to rise as supplies of the premium quality grain preferred by consumers remain tight.<\/p>\n

Preferences vary across states, and dry weather has cut supplies of rice varieties favoured in southern India, pushing up prices, said B.V. Krishna Rao, president of the Rice Exporters Association.<\/p>\n

Wheat, India\u2019s main winter crop, has climbed to \u2060a nearly two-year \u200bhigh amid concerns that El Ni\u00f1o could bring warmer winter conditions and curb production early next year.<\/p>\n

Food inflation will depend partly on \u200bhow the winter crop season unfolds, with poor soil moisture and the risk of warmer temperatures threatening to further squeeze supplies.<\/p>\n

\u201cAmidst elevated crude oil prices, higher food inflation and an uncertain outlook for the kharif (winter) crop, sustaining economic activity while safeguarding price stability will be \u200bthe focus of policymakers in the second half of the financial year,\u201d the government said in its monthly economic report for October.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

Indian farmer Amarsingh Gushinge wants to sow wheat and chickpeas in coming weeks to capitalise on attractive prices, but dwindling water supplies after below-average monsoon rains are preventing him from planting either crop. Like Gushinge, millions of farmers, especially in southern and western India, are facing water shortages as they prepare to plant winter crops. \u201cThere\u2019s not enough moisture in the soil to sow \u200bthe next crop, and no money left to do so either,\u201d said Gushinge, 78, at Rajewadi village, about 400 km east of Mumbai. The Jalna district…<\/p>\n","protected":false},"author":1,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[19],"tags":[],"class_list":["post-3743","post","type-post","status-publish","format-standard","hentry","category-english"],"gutentor_comment":0,"_links":{"self":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/posts\/3743","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcomments&post=3743"}],"version-history":[{"count":0,"href":"https:\/\/ipp-news.com\/index.php?rest_route=\/wp\/v2\/posts\/3743\/revisions"}],"wp:attachment":[{"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Fmedia&parent=3743"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Fcategories&post=3743"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/ipp-news.com\/index.php?rest_route=%2Fwp%2Fv2%2Ftags&post=3743"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}