Wheat and Sugar Crop Outlook for 2025

March 10, 2025

The agricultural landscape in 2025 presents a mixed picture for key rabi crops, particularly wheat and sugar. As the wheat harvest approaches, uncertainties linger regarding yields. Simultaneously, sugar production faces challenges that could impact food inflation.

Current Wheat Production Status

Wheat is important rabi crop in India. As of early 2025, the government holds around 140 lakh tonnes of wheat stocks. This is a notable increase from last year’s 75 lakh tonnes. The opening stocks for the upcoming procurement season are projected to be higher, providing some buffer against potential shortages. The government has adopted a cautious approach, limiting open market sales to stabilise prices.

Procurement and Pricing Dynamics

Wheat prices in Delhi are currently between Rs 2,950 and Rs 3,000 per quintal. This is higher than the previous year’s prices. The government has imposed stocking limits on traders and retailers to prevent hoarding. The new crop is expected to arrive between March and April, and prices may adjust based on production levels.

Weather Impact on Wheat Yields

Weather conditions play a critical role in determining wheat yields. Reports indicate favourable conditions in central India, with expectations of a 15-20% increase in yields compared to last year. The grain-filling stage is crucial, and temperatures must remain stable. If temperatures stay below 35 degrees Celsius, yields could improve, alleviating inflation concerns.

Sugar Production Challenges

In contrast to wheat, sugar production is facing a downturn. Initial estimates projected a gross production of 333 lakh tonnes. However, ongoing assessments have reduced this figure . As of February 2025, net sugar production is estimated at around 220 lakh tonnes, down from the previous year’s output.

Factors Affecting Sugar Output

Several factors have contributed to declining sugar production. Subpar rainfall in key sugar-producing states like Maharashtra and Karnataka has affected cane availability. Additionally, pest attacks and disease susceptibility in sugarcane varieties have further exacerbated the situation. These challenges could lead to a demand-supply mismatch, particularly during the festive season.

Price Trends for Sugar

Ex-factory sugar prices have risen, reaching Rs 40.10-41.10 per kg in Uttar Pradesh and Rs 38-38.70 in Maharashtra. This increase is concerning as it may lead to inflationary pressures. The government may need to consider stock limits or import facilitation to manage supply.

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