What does record food production mean for India?

What is the News?

Food production in India is estimated to touch a record 316 million tonnes in 2021-22, 8%  more  than  the  five-year  average. 

How was the food production in India this year?

The production of food grains including rice, wheat, pulses, and coarse cereals is estimated at 316 million tonnes in FY22 which is 8%  more  than  the  five-year  average. 

In addition, oilseed production is estimated  at  over 37 million tonnes, 12% higher than the five-year average. 

Sugarcane production too is set to rise by 10% compared to the five-year average. 

What does this mean for retail food prices?

The higher production of pulses and oilseeds is a relief since India is dependent on imports to meet domestic consumption.

This is particularly true for oilseeds, where India is acutely dependent on imports to meet half of its domestic requirement.

What are the risks going ahead?

The foremost risk is rising crude oil prices, which crossed $95 a barrel, the highest since 2014, amid heightened tensions between Russia and Ukraine. 

High oil prices lead to higher fertilizer and input costs for farming, diversion of food crops to produce biofuels and high shipping costs. Hence, it will likely impact food prices.

What steps the government should take?

Except for oilseeds and pulses, India is largely self-sufficient in food production. 

Massive public stocks of rice and wheat: This can be off-loaded via the public distribution system or through open market sales when prices rise. 

Rising crude and fertilizer prices may also force the Center to reduce the higher fertilizer subsidy bill to keep farming costs in check.

Source: This post is based on the article “What does record food production mean for India?” published in Livemint on 21st February 2022.