From Gulf Crisis To Weather: Why Indian Farmers Are Being Hit Hard

It seems the war and the weather have both betrayed our farmers. Apart from disruptions in fossil fuels, the food economy is showing major signs of distress, too. Basic staples, from rice to edible oils, are all negatively affected and displaying a variety of symptoms. From hyperinflation in the global markets to prices crashing in the domestic ones. The stagnating exports and now climatic disturbances are threatening our food economy.

So let's begin by taking stock of things. Firstly, the war in Iran has disrupted the Gulf region and resulted in rising fossil fuel prices, and also limited supplies of critical LNG and agri-chemical supplies from the region. The blocking of the Strait of Hormuz has also stopped all food exports into the region.

Countries like India were major suppliers of food to the region, as the food exports from India were more suited to the Gulf palate. Indian food exporters are in disarray as most of their stocks are stuck at ports. Now the government has also launched a Rs 497 crore RELIEF scheme to support exporters. But nevertheless, this move has caused a major crash in major staple food economies.

Let’s examine the case of rice. Basmati rice prices have fallen by at least 10% in the domestic markets as exporters are refusing to buy more rice from millers and farmers. Exporters' money is currently stuck in the basmati stocks at the port, for which they are paying interest and storage charges. Meanwhile, the new basmati prices are falling rapidly.

Now, if we compare this scenario with the global prices, due to overproduction and a good harvest, rice production is higher and due to fears of Super El Niño prices global rice prices rose by 11.1% as of mid-February 2026, diverging sharply from trends in other agricultural commodities such as corn and sugar. If we look at rice futures, they rose above $11 per hundredweight in March, the highest spike in about a month, tracking broader gains in grain markets amid the war involving Iran.

What concerns India more is the rising prices of edible oils. Soybean oil crossed $1,100/tonne and was trading between $1,080 and $1,150 tonnes in the international markets. Other edible oil sources, such as crude Palm oil, have also seen an increase of about 1.8%, the highest it has been since June 2022. It continues to float above the $1,350 mark in March. Sunflower oil coming from the Black Sea ports also reached its highest in three years and stood at $1,355 per tonne FOB.

India depends heavily on imported edible oil, including palm oil and soybean oil, which the fossil fuel cargos stuck carry. Some holders are also using edible oils in biodiesel production. Overall, higher edible oil prices coupled with rising LNG prices will definitely have a steep impact on our thalis.

So while the world is experiencing rising prices, India, one of the world's top exporters, is having prices crash for staples, and is further burdened with paying more for critical fossil fuels and edible oils, draining our forex reserves.

To top it up, we have the advent of western climatic disturbances due to the usually hot March. The mainland areas of the subcontinent had heated up more than usual, inviting high moisture-laden winds in. These winds are causing havoc for farmers all across the country as major parts report stormy winds, hailstorms and rain, which is falling on standing wheat and mustard crops.

The wheat crop has suffered a big blow in northern India. Punjab, for example, received about 408% excessive rainfall, and parts of Uttar Pradesh, from Gonda to Shravasti, are reporting crop losses due to excessive rain and lodging of the wheat crop in areas. This weather is expected to continue till 24th March as per reports. The damage to mango and other horticulture fruits like apples is yet to be evaluated. Overall, the weather has yet again impacted the Rabi production.

Food exporters that were waiting to purchase legumes or wheat, etc., have also shut shop and refused to buy, as the ports are full of food shipments. The government of India, after 2022, for the first time allowed wheat exports, but, gauging from the weather damages, the government may have to reinstate the export ban to meet local demands.

This could further cause a fall in Rabi crop incomes for farmers, especially at a time when Rabi crops in north India have already been devastated by unseasonal rain. To conclude, India's food economy should prepare to absorb a lot of shocks, and hence, the government needs to be proactive in having safety measures in place. We must also think of moving away from industrial methods of agriculture, and begin to think of indigenous ways of crop planning, which is already understood better by the farmers and also be more climate resilient and also doesn’t depend on foreign agri-inputs. We have to also swerve away from over-production in cereals like rice and wheat, and have a more balanced nutrition approach towards our agrarian policy. Farmers ought to encourage more millets, oilseeds and legumes instead of rice and wheat.

The government recently reiterated its commitment to the PM-PRANAM scheme (Prime Minister's Programme for Restoration, Awareness, Nourishment, and Amelioration of Mother Earth), but it still has a long way to go before the whole of industrial agriculture is removed as the dominant agricultural practice in the country. We have to make this scheme the top priority of our country and start shifting our entire agricultural outlook towards self-reliance in food and agri-inputs. This is the only way we can make ourselves resilient against climatic disturbance and Gulf fossil fuel import dependence at the same time.

(Disclaimer: The facts and opinions expressed in this article are those of the writer and do not reflect the views of ETV Bharat)