India’s Rice Stocks Grow to Record Levels: Global Prices Under Pressure Amid Surpluses

India has amassed a historic surplus of rice, holding more than 52 million tons in stocks—far exceeding its buffer and strategic reserve norms. With more than three million tons of this grain aging for over three years in government warehouses, storage costs and market concerns are mounting. This large and growing surplus comes even as the world’s biggest rice exporter continues to set new export records and as global buyers monitor India’s moves with unease. High reserves are beginning to stress storage capacity, prompting fears India could ease restrictions and release massive volumes onto already fragile international markets experiencing droughts in Vietnam and Thailand.

This places significant downward pressure on global prices, especially since Indian export rice is now being offered about €100/ton cheaper than its competitors. Internally, India faces challenges handling old grain, fuelling speculation that policy changes or subsidized liquidation may be imminent if volumes continue to rise. Meanwhile, global stocks are tightening and weather volatility keeps the rice trade—and prices—in suspense. Recent data presents a crossroads: will India flood markets to manage old stock, or will it continue export curbs? World markets are bracing for policy signals in the crucial months ahead.

📈 Prices & Market Sentiment

Origin	Type	Location	Delivery	Price (€/kg)	Weekly Change	Sentiment
IN	all golden, sella	New Delhi	FOB	1.05	0%	Neutral / Bearish
IN	all steam, pr11	New Delhi	FOB	0.56	0%	Neutral / Bearish
IN	al ısteam, sharbati	New Delhi	FOB	0.71	0%	Bearish
IN	all steam, 1121 steam	New Delhi	FOB	0.97	0%	Bearish
IN	white sella, 1121 creamy	New Delhi	FOB	0.89	0%	Neutral
VN	long, white, 5%	Hanoi	FOB	0.60	0%	Bullish (due to drought)
VN	Jasmine	Hanoi	FOB	0.62	0%	Firm
VN	calrose	Hanoi	FOB	0.80	0%	Bullish

🌍 Supply & Demand Snapshot

• India’s Stockpile: 52.5 million tons (as of Sep 1), up 13% y/y; 3+ million tons in storage >3 years
• Buffer norms: Only 13.5 million tons required
• Exports: 2022–23: 22.23 million tons (€11.14B); 2023–24: 15 million tons (€8.8B) despite restrictions
• Demand: Global importers anxious over potential market flooding
• India’s market dominance: #1 exporter, current offering approx. €100/ton cheaper than rivals
• Vietnam & Thailand: Droughts likely to limit supply, keep attention on India’s policy

📊 Key Fundamentals & Policy Drivers

• Production: 2025–26 forecast: 151 million tons (vs. 150 million prior year)
• Old stocks: Persistent carryover, expensive storage—forcing government to consider liquidation or expanded welfare programs
• Exports: Remain high, but potentially curtailed by bans or minimum price floors
• Speculator sentiment: Bearish for Indian-origin, Neutral to bullish for Southeast Asia
• Policy volatility: Export rules, state releases, and subsidies in spotlight; any change could prompt massive price movement

⛅ Weather Outlook for Key Producers

• India: Southwest monsoon has performed near average, ensuring normal crop output for main states (Punjab, Haryana, West Bengal)
• Vietnam/Thailand: Rainfall deficit and high Temperatures; Mekong Delta, Chao Phraya Basin experiencing below-normal precipitation—risk for late-season crop yields
• Short-term impact: Weather risk supports Vietnam/Thai prices, while India’s surplus condition increases bearish risk

🌏 Global Production and Stocks Comparison

Country	2024/25 Prodn. (mln t)	Stocks (mln t)	Export Share (%)
India	151 (proj.)	~52	39
Vietnam	44	5	12
Thailand	33	5	10
Pakistan	9	2	8
China	211	94	Minimal
Other	various	various	various

• India’s stock surplus exceeds combined buffer & strategic norms x3
• China holds largest stocks, but for domestic security
• Vietnam/Thailand vulnerable to adverse weather

⚡ Trading Outlook & Recommendations

• Exporters: Prepare for potential further price declines in Indian-origin rice; consider forward hedges. Beware sudden policy shifts (export bans or subsidies).
• Importers: Monitor Indian government statements closely. Anticipate possible opportunity to lock in low-cost supply if India relaxes restrictions.
• Traders: Bearish short-term view on Indian rice; modest upside risk for Vietnam/Thai grades if drought continues or India maintains strict curbs.
• Producers: In Vietnam/Thailand, higher prices likely if drought worsens. India: Focus on old stock liquidation or diversifying export strategies.
• Speculators: Watch policy headlines, especially subsidy or welfare announcements from India. Volatility spikes expected.

📆 3-Day Regional Price Forecast

• India (FOB New Delhi): Slightly Bearish; prices may ease another 1–2% if sentiment sours on aged stocks
• Vietnam (FOB Hanoi): Neutral to Bullish; pricing could firm 1–2% if drought persists
• Thailand: Firm to Bullish; low Mekong/Chao Phraya supplies support price stability or modest increases