India's Rice‑to‑Ethanol Plan and Brazil's Grain Stock Purchases Shape Global Market

India is reconsidering the use of public rice stocks for ethanol production as a way to manage large surplus inventories. Analysts note that rice is less competitive than sugarcane or corn for biofuel, but converting excess rice to ethanol could reduce storage costs and avoid a sudden market glut that would depress international rice prices. Because India is the world’s top rice exporter, the policy shift is being watched closely by other market participants.

In Brazil, Minister of Agrarian Development Fernanda Machiaveli announced that the government will procure grain stocks—including up to 310,000 tonnes of rice and 180,000 tonnes of millet—through auctions run by the Companhia Nacional de Abastecimento (Conab). Purchases may be made at market prices up to 25% above the minimum, using an extraordinary fund of 849 million reais within a broader R$1.3 billion package aimed at mitigating potential El Niño impacts on the southern harvest. The move is intended to build buffers against supply disruptions and price volatility.

Both actions illustrate how major producers are using strategic stock management and alternative uses of commodities to stabilize markets and protect domestic food security.