Rice prices have seen a stark rise by more than 10% in parts of India over the past few weeks, with traders and millers finding tight paddy supplies as the market enters the lean period between crop cycles. A weak monsoon has also fuelled concerns over the availability of the next crop.
The sharpest increase has been seen in premium non-basmati varieties such as Sona Masuri, Ponni and Masuri. Swarna rice prices have climbed to around Rs 34 per kg ex-mill from Rs 30 per kg, an increase of more than 13%, according to a BusinessLine report cited by The Wire.
The price rise has also been driven by seasonal factors. Arrivals from the zaid and rabi harvests have largely ended, while fresh kharif supplies are not expected before October. Until then, the market will depend largely on existing stocks, the report said.
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The weak monsoon has created additional uncertainty over the availability of the next paddy crop. The concern is that continued rainfall deficiency could affect paddy sowing and production, potentially extending the current supply pressure into the next crop cycle. This is an assessment reported by The Wire in context of the current monsoon conditions rather than a confirmed forecast of crop failure.
The current price rise comes despite the Union government's estimate of record paddy production for 2025-26, the BusinessLine report stated. The industry representatives have instead pointed to current stock availability and the timing of crop arrivals as important factors in affecting prices.
M. Madan Prakash, president of the Tamil Nadu Agri Commodities Exporters Association, told BusinessLine that millers were reporting a slight shortage of paddy. Rajesh Jain Paharia, a New Delhi-based exporter, attributed the increase primarily to the supply-demand situation, The Wire reported.
The Union government's higher minimum support price for common paddy has added to the cost environment. The MSP for the 2026-27 crop was raised to Rs 2,441 per quintal from Rs 2,369.
Karnataka has also recorded a significant price increase, with The Times of India reporting that wholesale Sona Masuri prices in the Gangavathi-Sindhanur belt rose by Rs 200-300 per quintal within 15 days.
The newspaper attributed the increase to lower paddy output, transportation costs and storage expenses. Retail prices also increased, with Sona Masuri reportedly rising from Rs 55 to Rs 70 per kg.
The outlook for rice prices will depend heavily on monsoon conditions, paddy cultivation and the arrival of the next kharif crop, according to the market assessments cited by The Wire.
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