Rice prices may surge in the coming months as stocks are depleting fast on the back of deficient rains and fall in output, a study by industry chamber Assocham said, urging the government to closely monitor prices and stocks as the domestic demand for rice is huge.
“Though the government estimates kharif rice production at 90.61 MMT (million metric tonnes), this is unlikely to be achieved due to severe deficit rains in Punjab, Haryana, Uttar Pradesh, Bihar, Maharashtra and Karnataka and the best that could be achieved is 89 MMT,” according to a paper on ‘Impact of weak/deficient monsoon on agricultural production and prices’ by the Associated Chambers of Commerce of India.
Output estimatesThe actual production may be around 103 MMT during 2015-16. Moreover, rice stocks have been steadily declining in the past three years, the study added.
“Increasing export outgo on account of the public distribution system and other welfare schemes will continue to weigh on availability in the open market. Unless the government is able to handle the situation prudently, depleting stocks will soon reflect on the open market prices,” Assocham said.
The industry body suggested that direct seeded rice (DSR) should be encouraged to conserve water. At present, less than 10 per cent of paddy production is under DSR due to limitations in the availability of suitable equipment for DSR in clay soils.
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