Private trade may soon get access to the wheat stored in Food Corporation of India (FCI) godowns for exports, as the Government plans to allow an additional shipment of 5 million tonnes (mt) soon.
The Government, the biggest wheat stockholder with an estimated 30.8 mt as on February 1, is under pressure to create storage space for fresh produce as the country looks forward to a bumper harvest for the third year in a row. As on January 1, the current central pool stocks were close to thrice the prescribed buffer and strategic reserves of 11.2 mt.
Sources said the Food Ministry had circulated a note for inter-ministerial discussions on allowing exports of an additional 5 mt for which the Union Cabinet is expected to set the price.
The Government has, so far, allowed exports of 4.5 mt from the Central pool stocks mainly by State-run trading corporations.
The State entities, such as PEC, STC and MMTC, have tendered about 2.5 mt so far and have actually shipped out 1.6 mt.
Private trade, which largely sources from the open market, has exported about 2 million tonnes. Total wheat exports from India since October 2011 till date stand at around 3.6 mt.
Bumper crop likely
India has emerged as one of the largest exporters of wheat this year and the bulk of it has been shipped to Korea and Taiwan, as also to neighbouring countries such as Bangladesh, Sri Lanka and Yemen.
The country, which produced close to 94 mt last year, aided by a conducive climate, expects to harvest a similar crop in the current year as acreage is almost similar to that of last year.
However, the temperature during February and March would decide the crop size.
The Government, which hiked the minimum support price for wheat by Rs 65 a quintal to Rs 1,350, expects to buy about 42 mt in the rabi marketing season 2013-14.