Indian Black Gram Stays Firm as Acreage Shrinks and Imports Turn Costly

Indian black gram (urad) prices remain firm, supported by sharply lower kharif planting, limited domestic arrivals and higher import costs amid a weaker rupee. Even as international offers have improved slightly, tight import availability and weather risks are preventing any meaningful downside in spot and processed product prices. Acreage data show a steep year‑on‑year decline in sowing, especially in Madhya Pradesh, while gains in Gujarat are too small to change the national picture. At the same time, import parity has worsened as the Indian rupee has depreciated and Myanmar offers stay elevated. With the Indian Meteorological Department flagging a below‑normal monsoon for June–September 2026, concerns about yield and production are likely to persist, keeping the urad complex on a firm footing over the near term.

Prices

Indian urad prices strengthened during the latest reporting period as domestic and imported supplies remained tight. Imported FAQ-quality urad advanced by roughly USD 1.05–1.57 per quintal over the week, trading near USD 88.16 per quintal, while SQ-quality lots hovered close to USD 96.03 per quintal. Madhya Pradesh-origin urad, despite restricted availability, was quoted around USD 83.96–88.16 per quintal.

Processed urad products also reflected this firmness. Urad dal chilka traded near USD 96.56–117.55 per quintal, and washed urad dal was assessed at about USD 96.56–115.45 per quintal. Myanmar-origin cargoes for June–July shipment remained expensive, with FAQ offers around USD 835 per tonne and SQ at USD 895 per tonne, underpinning domestic price resilience.

Supply & Demand

The most notable fundamental shift is on the supply side. By 12 June, kharif urad planting in India had reached only about 155,000 hectares, a sharp drop from roughly 273,000 hectares a year earlier. Madhya Pradesh – a key producing state – saw acreage collapse from around 35,000 hectares to just 8,000 hectares, signalling a potentially significant cut in 2026/27 output.

Gujarat showed some resilience, with urad area rising from about 232 hectares to roughly 673 hectares, but this gain is far too small to compensate for losses elsewhere. Limited domestic arrivals, in combination with this acreage decline, have tightened spot availability and allowed producers and stockists to defend higher price levels.

On the import side, international availability has improved somewhat, but effective supplies into India remain constrained by cost. Myanmar-origin FAQ and SQ quotes near USD 835 and USD 895 per tonne respectively, together with a weaker Indian rupee, have raised landed costs. This has curbed the incentive for large-scale imports and helped keep domestic markets supported.

Fundamentals & FX Impact

A softer Indian rupee is a key reinforcing factor in the current rally. Even as world prices have eased marginally, currency moves mean that the import parity for urad has worsened, pushing up replacement costs for traders. This has translated into week-on-week gains in imported FAQ urad and continued firmness in SQ and domestic-origin lots.

Downstream, mills are facing higher raw material costs, which are being passed through into processed products. The elevated prices for urad dal chilka and washed urad dal suggest that consumer and wholesale demand has not weakened enough to force discounts, implying relatively inelastic consumption in key segments of the pulse market.

Weather & Monsoon Outlook

Weather risk is an additional bullish element. Forecasts indicate that the 2026 southwest monsoon (June–September) will likely deliver below-normal rainfall at about 90% of the long-period average, with particularly weak outcomes expected over central and peninsular India – areas important for rainfed pulses. This environment raises concerns about both sown area and yields for kharif urad.

Early-season observations have already pointed to a subdued monsoon onset and a rainfall deficit across much of India. While lower international crude oil prices could moderate transportation and logistics costs, this is unlikely to offset the price impact of reduced acreage, weather uncertainty and costly imports during the current marketing window.

Trading Outlook

• Bias: Short-term tone remains firm to mildly bullish, given sharply lower acreage and limited import relief.
• Producers: Consider staggered sales rather than heavy near-term liquidation, as current fundamentals justify sustained strength barring a sudden improvement in monsoon performance.
• Millers/Buyers: Secure near-term coverage on price dips and diversify origins where feasible, as Myanmar offers and FX trends point to elevated replacement costs.
• Traders: Maintain a modest long bias in physical or nearby contracts, but monitor monsoon developments and any policy steps on imports that could cap prices.

3-Day Market Indication (Direction, EUR Terms)

Based on current USD-denominated price levels, weaker rupee and a broadly stable EUR–USD rate, benchmark Indian urad prices in EUR terms are expected to remain steady to slightly firmer over the next three trading days. Minor intra-day corrections are possible, but the underlying trend is likely to stay upward-biased as long as acreage and monsoon concerns persist.