Rising Temperature Threatens Wheat Production in India

Indore: Concerns are also growing in Punjab, Haryana, and Uttar Pradesh, where the maximum temperatures are steadily rising day by day. Maximum temperatures in Madhya Pradesh, Gujarat, and Maharashtra have been reaching 30°C. In India's major Wheat-growing states, the crop is in the jointing to anthesis stage. Increased temperatures are severely affecting Wheat crops' ability to fill their grains and could cause shriveled grains. Concerns about lesser yields are also being raised by the above-average temperatures that have spread across the Wheat region in North India. As a result, we predict that Wheat production will drop approximately below 99 MMT this year.

The first two weeks of December 2022 saw above-average temperatures continue to be detrimental to crop growth, but the cold snap and drop in temperatures swept across Northern and North-western India in late December, and the first two weeks of January 2023 improved crop health. At the vital growth stages, the temperatures significantly impact the Wheat crop. Concerns have been expressed regarding crop yields in February due to the recent rise in temperature over India's Central and Northern Wheat-growing regions.

The supply situation would remain tight in the upcoming year if there were consecutive years of reduced Wheat production. It would be challenging for the central government to manage the food security schemes in the upcoming year if a sizable amount of Wheat is not purchased, which may once more fuel food inflation. Even the central pool Wheat stocks, which were 15 MMT on February 1 and had fallen to almost five-year lows, were severely declining.

As per the ChemAnalyst database, the price of Wheat is likely to increase in the upcoming month if the temperature remains to elevate in the upcoming time, and even during the busiest arrival season, the downward correction in grain prices would be very small due to smaller crop sizes and constrained central pool supplies, which would maintain a bullish trend.