The Hindu Business Line : Australian wheat to arrive in April first week

From all available indications, loading of the first consignment is set to begin on March 20 from Adelaide. It will be April 4 or 5 when the ship, Furness Australia, will call at Chennai port.

The vessel, currently on its way to the port of loading, is a bulk carrier and will be shipping around 45,000 tonnes.

On February 2, the Centre decided to import wheat into southern ports of Mangalore, Visakhapatnam, Tuticorin, Chennai and Kochi to rein in rising prices of the foodgrain. Prices are up on lower stocks and production.

The State Trading Corporation (STC) is handling the imports on behalf of the Centre and Australia's monopoly wheat marketing body AWB Ltd has won the tender to supply wheat at $178.75 a tonne c&f.

Issues

Indications are that once the first consignment leaves Australia, another 3-4 vessels will depart for Indian shores in a week's time. AWB has nominated these vessels. However, the problem for AWB is that there are only three ports where methyl bromide can be used for fumigation before shipping the wheat. Methyl bromide is an odourless, colourless gas that has been used as a fumigant to control a wide variety of pests. However, its use has been curbed as it is seen as ozone-depleting agent. Also, AWB is finding it tough to get vessels to ship wheat.

Initially, the first consignment of the imported wheat was scheduled to arrive before the month-end. But it got delayed as STC took time in appointing clearing agents and transport contractors. These agents and contractors were finalised this week only.

For buffer stocks

FCI officials said all the five lakh tonnes of wheat being imported would be for the buffer stocks. The Centre had, while deciding to import, said the shipments would be used as per its discretion, including for commercial transactions.

According to the officials, the buffer stock currently is around 30 lakh tonnes, including consignments that are being dispatched to various parts of the country.

Meanwhile, sources said the Centre's move to import the wheat on c&f basis rather than f.o.b was because it had to get in the stocks into the country at the earliest. The Shipping Ministry has opposed to imports on c&f basis, saying it is violation of the Centre's policy.

The Union Shipping Minister, Mr T.R. Baalu, had objected to the c&f basis imports on the grounds that all Government imports should on f.o.b basis with its chartering arm Transchart handling the shipments into the country. The f.o.b policy was formulated to help the Indian shipping sector.

AWB would only be happy to export on f.o.b basis given the fact that they are finding it tough to get ships to send wheat to India, according to the sources. Currently, no Indian ship is reportedly available to bring in the wheat consignment.

The sources also point out to the "informal clearance" from the secretary of the ministry to strengthen their argument.

The shipments are scheduled to last till the middle of May.

Meanwhile, prices of wheat have slid below Rs 1,000 a quintal after rising earlier this week. Currently, wheat dara is ruling at Rs 970-975. On February 2, when the Government decided to import the foodgrain, wheat dara was quoted at Rs 957.

Wheat stocks have slid below the buffer stock norm, while production during the last couple of years has stagnated at around 72 million tonnes.

This year, the Government, as per its latest estimate, anticipates a production of 73.06 million tonnes.