THE FAO Indica Rice Index averaged 151.8 points in September 2023, a 15-year nominal high in the aftermath of a ban on white rice exports by India in August, world's largest rice exporter. Indica is a variety of rice only grown in the sub-continent. Last year, India had exported 22 million tonnes of rice, of which the cheaper Indica white rice constituted six million tonnes. While the ban could end up hurting top-line growth of domestic rice millers, fresh crop supplies beginning October could prompt the government to revoke the curbs.

POOR CHINESE demand, energy crisis in Europe, and harsh weather conditions have contributed to lower natural rubber prices globally. In India, while the production was 839,000 tonnes, in FY23, consumption touched 13,50,000 tonnes. With consumption expected to stay higher, the overhang of imports owing to cheaper prices could keep domestic prices low. That is good news for domestic makers of tyres and other rubber-based products as their profit margins could trend higher on lower input costs.

WHEAT FUTURES were hovering near their three-year lows, reflecting higher seasonal availability from ongoing harvests across the northern hemisphere. Prices have fallen more than a fifth since the end of July. Traders are betting that the trend will continue as S&P Global projects plantings for 2024 are down 2% from a year ago. In India, wheat prices have hit an eight-month high, gaining 22% in six months owing to the onset of the festive season. However, weak global prices could act as a dampener given the threat of imports. But for now, FMCG firms will have to bear the brunt of local inflation.

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