India’s government has offloaded a record 5.6 million tonnes (MT) of rice to bulk buyers this fiscal, surpassing last year’s high of 4.63 MT. Yet, central rice stocks continue to grow, crossing 47 MT, 3.5 times the official buffer norm.
Surging Stocks Despite Record Offloading
Despite record offloading through open market sales, ethanol production, and state welfare schemes, India’s rice reserves remain at multi-year highs.
Sources indicate that the government may release 6–7 MT of rice in FY26 to manage excess stocks held by the Food Corporation of India (FCI).
As of October 1, the central pool held 47 MT of rice, including nearly 10 MT yet to be received from millers. Officials link the stockpile to robust crop output and high MSP-based procurement, which together keep inventories elevated.
Allocation Breakdown for FY26
Between April 1 and October 8, 2025, the FCI supplied:
- 2.46 MT for ethanol manufacturing,
- 2.06 MT under state welfare schemes,
- 1.03 MT through e-auctions, and
- 0.06 MT for the Bharat Rice initiative.
In comparison, FY25 saw a total offloading of 4.63 MT, and just 1.54 MT and 1.78 MT in FY24 and FY23, respectively.
Financial Concerns Mount
Excess rice reserves are raising the economic cost of grain storage. The cost, including MSP, logistics, and warehousing, was estimated at ₹ 41.73 per kg at the start of FY26 and could rise further with surplus stocks.
Government officials warn that carrying costs might push the food subsidy bill beyond its estimated ₹ 2.03 lakh crore, possibly increasing expenses by another ₹ 22,000 crore.
Procurement and Welfare Support
Each year, the FCI and state agencies purchase around 52–53 MT of rice under the Minimum Support Price (MSP) system. Roughly 36–38 MT is distributed through the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY), which provides free monthly rations to 810 million beneficiaries.
The government extended the PMGKAY till 2028, committing ₹ 11.8 trillion to ensure food security. Meanwhile, the ongoing 2025–26 procurement season has already reached 3.41 MT, compared to 0.91 MT during the same period last year.
Market Prices and Outlook
To manage the surplus, the government fixed the reserve price of rice as follows:
- ₹ 2,250/quintal for ethanol and state allocations,
- ₹ 2,400/quintal for Bharat Rice, and
- ₹ 2,800/quintal for bulk e-auction sales (valid till October 31, 2025).
Experts say rice prices in India remain stable due to sufficient government buffer and smooth market offloading. However, export-focused millers continue to monitor global trends, where top 10 rice exporters in India play a key role in maintaining trade balance alongside the top 10 rice exporters companies in the world.
Conclusion
India’s record rice stockpile highlights both its agricultural strength and the challenges of managing surplus grain. Strategic offloading and stable rice prices in India will be critical to controlling costs while sustaining export growth. The coming months will test how efficiently the FCI balances domestic supply, welfare commitments, and global trade competitiveness.