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Our Bureau

New Delhi, Dec 10

State Trading Corporation of India (STC), on Friday, floated a tender to import up to 3.5 lakh tonnes (lt) of wheat on the Government account.

The tender, to open on December 17, has sought delivery of 65,000 tonnes at Mundra, 50,000 tonnes at Kakinada, 45,000 tonnes at Kandla, 40,000 tonnes each at Chennai, Visakhapatnam and Tuticorin, and 35,000 tonnes each at Kochi and Mumbai ports.

The entire wheat is to arrive before April 15, with the bidders required to quote maximum quantities port-wise. Unlike earlier tenders, there is no stipulation for bidders to indicate any month-wise quantity arrival schedule. Instead, only an outer deadline of April 15 has been mentioned. The bid offers made are valid for acceptance till December 22.

During the current fiscal till now, the Union Government has contracted about 18 lt of wheat imports for the public distribution system (PDS). This includes 5.11 lt through STC’s tender of July 27 (at a weighted average price of $325.59 a tonne, cost & freight), 7.95 lt through its tender of August 30 (at $389.45 a tonne), 3.425 lt through MMTC Ltd’s tender of November 12 (at $400.19 a tonne), and 1.5 lt through PEC Ltd’s tender of November 26 (at $396.9 a tonne).

During 2006-07, the Government has altogether contracted 55 lt of imports (exclusively through STC) at an average landed price of $205.31 a tonne.

As on November 1, wheat stocks in the Central pool amounted to 90.25 lt, which is higher than the 59.94 lt held on the same day last year.

At the same time, there are worries about the prospects for the coming crop to be harvested from next April. Till December 7, only 174.82 lakh hectares (lh) have been sown under wheat, which is 18 per cent below the 213.74 lh covered during the same period last year.

The drop in acreage, notwithstanding a Rs 150 per quintal increase in the official procurement price to Rs 1,000 per quintal, is being attributed mainly to dry weather in large parts of central and northern India. In addition, erratic supplies of di-ammonium phosphate (a crucial fertiliser required during sowing time) and the near month-long delay in start of crushing operations by sugar mills in Uttar Pradesh (preventing farmers from vacating their cane fields for planting wheat) have been blamed.

All this would necessitate large-scale imports for the Government, which is confronting the threat of elections by the middle of next year.

The impediment here, however, is the spiralling international prices.

The benchmark March contract for wheat at the Chicago Board of Trade (CBOT) is currently quoting at $9.37 a bushel ($344 a tonne).

Over the past month alone, prices have hardened by around $1.8 a bushel or $66 a tonne (one bushel = 27.216 kg).

At current rates, there is a possibility of STC’s latest tender eliciting contracts at over $450 a tonne, cost & freight.

More Stories on : Wheat | Exports & Imports

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