Climate change adds to supply-demand woes in staples

Food inflation — particularly of cereals — is on the boil. Our analysis shows that cereal inflation is not new in India. But the recent bout could be pinned down to the presence of three concomitant factors: higher global and domestic demand, and lower production due to climate change shocks. This has important implications for food, agriculture, trade, and nutrition security policies.

Cereals in numbers

Cereals form an essential part of Indians’ staple diet, from wheat in the north to rice in the south and east, to millets such as jowar and ragi in different regions of states.

Over half of the gross cropped area of the country is under cereal crops — paddy, wheat, and nutri/coarse cereals such as maize and millets. 

Production of cereals has consistently up-trended, logging a compound annual growth rate (CAGR) of 2-3% for the past 50 years.

Increase in awareness among farmers on good agriculture practices, support from government in the form of input subsidies and procurement at minimum support prices, positive export sentiments, and growth in domestic demand have all contributed to this trend.