El Nino fears push rice prices higher

Metro India News | Hyderabad

Concerns over the impact of El Nino on paddy production have begun driving up rice prices, with traders and rice millers attributing the recent surge to fears of lower crop yields. Over the past two months, rice prices have increased by around Rs 800 to Rs 1,000 per quintal, raising concerns about further inflation if rainfall remains below normal.

According to trade sources, fine rice is currently selling at around Rs 6,000 to Rs 6,250 per quintal, while older stocks are fetching even higher prices. Experts say the weak monsoon has already signalled the possible effects of El Nino, with June rainfall reported to be about 39 per cent below normal. If the rainfall deficit continues, paddy cultivation during the 2026 kharif season could be severely affected, leading to reduced production, falling reservoir levels and declining groundwater reserves.

To prevent a sharp rise in rice prices, the Telangana government is reportedly exploring measures to utilise its existing paddy stocks. Around 20 lakh metric tonnes of fine paddy procured during the 2025 kharif season remain available after meeting supply commitments to the Food Corporation of India (FCI) and the Civil Supplies Department.

Officials are considering releasing these stocks into the open market either by selling the paddy to private traders or by milling it into rice and marketing it directly through the Civil Supplies Department.