India’s farm sector faces input inflation and export delays from West Asia war
The conflict in West Asia is putting India’s farm economy under pressure before and after harvest, raising input costs while slowing exports of perishable produce.
India’s farm sector is being hit on two fronts by the war in West Asia. The Economic Times reported that before harvest, farmers and agribusinesses are dealing with rising input costs and growing labor strain, while after harvest exporters are facing shipping delays and spoilage risks for perishable produce. A two-week ceasefire was announced on Tuesday, but market participants say commercial logistics will not normalize overnight.
Rahul Chauhan, director of IGrain India, told the paper that the immediate priority is clearing the shipping backlog already built up, and that normalization could take at least six months. India remains well buffered in cereals: government data cited by ET show the Food Corporation of India holding about 60.7 million tonnes of rice and wheat, roughly 185% above the April 1 norm. But that cushion mainly protects staple grains, while fresh fruit and vegetable exports remain much more exposed to disruption.
The export hit has been especially severe for western India. According to the report, Gulf countries account for nearly 80% of Maharashtra’s grape and banana exports. After operations at Jebel Ali port were halted on February 28, around 800 to 1,000 containers carrying bananas, grapes, pomegranates, watermelons, onions and other vegetables were left stranded. Azhaan Merchant of Bharat Intelligence said more than 16,000 tonnes of grape exports from Maharashtra alone had been affected, with 5,000 to 6,000 tonnes already at ports and at risk of spoilage. He estimated the produce value in each stranded container at roughly Rs 24 lakh.
As export-bound volumes are pushed back into the domestic market, grower prices are already coming under pressure. Merchant said another 10,000 tonnes of orchard-ready export-quality fruit are now heading into local channels, while banana prices in Andhra Pradesh have fallen from Rs 23,000 per tonne to Rs 6,000 per tonne, a 74% collapse. At the same time, the conflict has pushed up farm costs: experts cited by ET said crude oil had climbed from around $70 a barrel to roughly $105 to $120, lifting agricultural input costs by 15% to 20% within a month.
The article also gave concrete examples of that inflation. C9 solvent prices rose from Rs 70 to Rs 105, a change that could increase product prices by 10% to 15% even though the component is a relatively small part of the total cost structure. R.G. Agarwal of Dhanuka Agritech said the system is still operating, but is already under strain from delayed shipments and higher costs. The bigger risk lies in the second quarter, when post-monsoon demand for agrochemicals rises and uncertainty over raw material flows could start to affect actual availability.
Labor has become another weak point. Because higher living costs linked to LPG disruption are making city work less viable for many migrants, some are returning home from major urban centers, and exporters in Jalgaon are already reporting shortages at farms and packhouses. That matters because horticulture relies heavily on manual harvesting, grading, packing and loading, and even short delays can reduce quality and returns. The government says essential food prices remain stable for now and that edible oil supplies are still supported by imports, but the report makes clear that India’s farm economy is increasingly focused on building more resilient input supply chains.