Farmers Are Facing Problems Amid Record Breaking Rice Production In The Country

Indian farmers are going to harvest the largest quantity of rice crop in history, which guarantees record exports.

Sukrampal Beniwal manages five acres (2 hectares) of beautiful green rice paddies in his village of Munak, in the northern state of Haryana, where the meetings over contentious farm policies is taking place.

"We won't move till the government repeals the regulations," he added, referring to three policies that farmers claim would jeopardize their livelihoods and are protesting in New Delhi by the tens of thousands.

Farmers in the heartland state have banded together to bring in the massive crop and ensure that every time a group leaves to harvest rice, another group leaves to join the demonstration on the outskirts of New Delhi, according to Beniwal.

"Because of our solidarity, we were able to handle the two competing tasks of coordinating the anti-legislation demonstration and harvesting a large crop," he continued.

The legislation, which was introduced in September of last year, de-regulates the agriculture industry by allowing farmers to sell their goods to buyers outside of government-regulated wholesale marketplaces, where growers are guaranteed a minimum price.

While small farmers complain that the changes expose them to big company competition and risk losing price support, the government claims that the reforms would provide them with new opportunities and higher pricing.

However, with global food prices are at decade high after a 30 percent increase in grain prices in the last year, India's problem of abundance also presents a brilliant opportunity.

According to traders, the fresh harvest will enhance exports and help the South Asian nation solidify its position as the world's leading provider of the most vital grain.

"Indian pricing are quite appealing at a time when demand from numerous importers, including China and a number of African nations, is very high," said Aditya Garg, a renowned grain exporter.

"In reality, several Indian exporters have gotten orders from a large number of new purchasers in Egypt, Sudan, Tanzania, and Iran for non-basmati rice."

Happening at a time when traditional export powerhouses Vietnam and Thailand are experiencing static output, the increased supply will allow New Delhi to offer more attractive pricing, undercutting any competitors.

Summer-sown rice output will reach a record 107.04 million tonnes in 2021/22, according to the agricultural ministry, while combined summer and winter rice output will reach 125 million tonnes, or nearly 24.5 percent of world rice output, the most ever.

With improved export infrastructure, India would be able to match, if not exceed, last year's record export total of 20 million tonnes, meeting rising demand for the staple from Asia, Africa, and the Middle East.

According to dealers, India is selling 25% broken rice, a non-basmati kind chosen by most international customers, at $345 per tonne on a free-on-board basis, compared to $360 given by Thailand, the world's second largest rice exporter. Some cargoes were even sold as $320 per tonne.

Farming Changes

Agriculture employs about half of India's 1.4 billion people and accounts for around 15% of the country's $2.7 trillion GDP.

According to government estimates, rice is India's top foreign exchange earning agriculture product, with shipments worth $8.82 billion in the fiscal year that ended in March 2021.

India's yearly rice exports totalled 11 million to 12 million tonnes till two seasons ago.

However, data from the United States Department of Agriculture (USDA) shows that shipments increased to 20 million tonnes last season, accounting for a record 40.7 percent of global trade, after growing problems in Southeast Asia pushed up the prices of rivals, making Indian non-basmati shipments attractive to hungry global buyers.

"Because climatic circumstances aided our farmers in increasing the country's rice output, we've permanently become a bigger participant in the worldwide market, and our share will expand," said Unicorp Pvt Ltd trader Rajesh Paharia Jain.

The rice farmers in Munak, 130 kilometers (80 miles) south of New Delhi, showed no signs of giving up.

"Our record crop demonstrates that we are making India more than food self-sufficient, and the government should not insist on rules that would kill agriculture," said rice farmer Ravindra Kajal.