Comments
Wheat exports have slowed in recent weeks as buyers, mainly from the Far-East, have switched over to Black Sea Origin grains, which are cheaper by about 15-20 per cent over the Indian produce.
While there are no new contracts, exporters including the public sector entities such as PEC, STC and MMTC are servicing the deals struck earlier. Exports in the current fiscal are estimated at around two million tonnes (mt). In the last financial year, wheat exports by the private trade stood at over 2.6 mt, while the public entities were estimated to have shipped out around three mt.
Wheat harvesting has picked up in the Black Sea countries such as Ukraine and Russia and prices for the grain range $240-250 a tonne f.o.b, whereas the Indian produce is still priced at $300.
The Government had fixed a floor price of $300 for exports mainly for stocks held by Food Corporation of India in its warehouses. The prices have not been revised despite a drop in the market. The drop even led to cancellations of some tenders by the PSU entities as the offer they had received were lower than the floor price.
“If India wants to continue exports, then it has to be at international prices and not at above market prices. By not revising the price for exports, India has been helping shipments from the Black Sea,” said Tejinder Narang, trade analyst adding that the country has lost about two mt in exports.
Indian wheat was largely imported by Far-Eastern countries for feed purpose.
Earlier during harvest, the Government had offered about five mt for exports through private players, to make storage space for the new crop.
However, there was no response from the trade as the price fixed by the Government was higher than global prices.
As on July 1, wheat stocks with Government stood at 42.3 mt, of which more than a fourth was stored in temporary sheds that could result in the grains getting spoiled due to rain.
The Government has procured about 25 mt this year, lower than last year. This is because production this year is estimated to be 80-84 mt. The Government is yet to come out with its final estimate for wheat output.
vishwanath.kulkarni@thehindu.co.in
Comments
COMMENT NOW
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.