Report on Wheat 27th September 2025 by Amit Gupta, Kedia Advisory
Agriculture at a Glance – September 2025
1. Rainfall & Reservoirs
* India received 6% excess rainfall (Jun–Aug 2025).
* Reservoir storage stood at 158 BCM, about 7% higher than last year, ensuring good rabi irrigation support for wheat sowing.
2. Kharif Acreage & Production Outlook
* Overall kharif acreage slipped 0–1% YoY, with production seen down 2–3% due to pest and excess rain impact.
* Paddy area rose, but commercial crops like sugarcane and soybean shrank. Wheat acreage is unaffected for now as it is a rabi crop.
3. Wheat Procurement Performance
* RMS 2025–26 procurement: ~30 MMT, up from 26.6 MMT in RMS 2024–25, meeting ~92% of the govt’s 32.3 MMT target.
* Procurement growth reflects higher MSP support and strong govt stock-building.
4. Price Movements
* Wheat mandi price in Aug 2025 was ?2,611/quintal, about 15% above MSP (?2,425).
* Prices rose 3% MoM and 1% YoY, supported by tighter domestic supply and demand recovery.
5. Credit & Input Support
* Agriculture credit grew 7% YoY to ?23 lakh crore (July 2025), keeping farm financing stable.
* Tractor, seed, fertilizer, and pesticide sectors posted revenue growth between 3–17% YoY, aiding wheat farmers’ pre-rabi input access.
6. Policy & Schemes
* MSP hikes for Kharif 2025–26 averaged 7% YoY; though wheat MSP revision will come in Rabi, the supportive stance boosts sentiment.
* Govt schemes like PM Dhan-Dhaanya Krishi Yojana (?24,000 cr outlay) and expanded PM Kisan transfers strengthen farmer liquidity ahead of wheat sowing.
Strengths
? International demand strengthened and concerns grew over dry planting conditions in the Black Sea region.
? For the 2025–26 season, MSP rose by over 6% to ?2,425/quintal, raising the minimum floor for market prices.
? Global markets tightened due to dry weather in key regions (Russia, Ukraine, Kansas), and persistent uncertainty, adding global price support.
? Private traders and flour millers held limited inventories, creating supply-pressure despite high production.
? The US Department of Agriculture reported weekly net export sales of 539,800 metric tons for the week ending September 18, bolstering bullish sentiment.
Weaknesses
? Wheat prices remained stable near 2820 as arrivals for Sep 2025 till date, rose by 37.52% to 12.16 lakh tonnes compared to 8.84 lakh tonnes same period last year.
? IMD issues above-normal rainfall forecast for September–November, boosting soil moisture and potentially increasing future wheat yields.
? Uttar Pradesh offers 1,000 quintals of wheat seed to Punjab farmers, aiding replanting after floods and restoring supply.
? The agriculture ministry has estimated wheat production at a record 117.5 MT during the 2024-25, an increase of 3.7%.
? IGC has raised its forecast for 2025/26 global wheat production by 8 million metric tons to 819 million tons.
Opportunities
? Sowing of wheat might get delayed this year in northern states, particularly in Punjab.
? The Centre has hiked the reserve price of wheat by 10.86 per cent, for sale under the OMSS-D during the 2025-26 financial year.
? Potential wheat export markets in Africa, Asia, and Europe could open if export ban is lifted.
? Government may slow or limit open market sales from stocks to support prices during festive demand season.
? Global 2025/26 consumption is raised 5.0 million tons to 814.5 million, largely on higher feed and residual use.
Threats
? India’s wheat inventories reached a four-year peak, stocks stood at 33.3 mln tns, well above the government's target of 27.6 mln tns.
? India says no immediate plan to permit export of wheat, wheat products – Food Minister Pralhad Joshi
? Government sets ambitious wheat production target of 119 mln tns for 2025/26, suggesting ample supply - Agriculture Minister
? USDA has revised its global wheat production forecast for the 2025–26 to 808.55 mln metric tons, marking an increase of 8.93 MMTs.
? Projected 2025/26 global ending stocks are raised 4.0 million tons to 264.1 million.
? European Commission raising its 2025/26 soft wheat production forecast to 132.6 million tons, the highest in a decade.
