NEW DELHI: India has signed contracts to export about 500,000 tonnes of wheat in recent days, cashing in on a sharp rally in international prices and signally a massive rise in overseas sales from the world’s second biggest producer of the grain.
According to reports, Indian traders have received inquiries from buyers seeking alternatives to Black Sea cargoes as Russia’s invasion of Ukraine threatened supplies from two producers which together account for 30% of world wheat exports.
After five consecutive record annual crops, India has large wheat inventories, and traders are keen to capitalise on any export opportunity. A high domestic price guaranteed by the government tends to deter exports unless world prices are high.
The surge in global prices has made it easier for Indian suppliers to meet the rising demand for wheat. The buyers, who are worried about supply disruptions from Ukraine and Russia, have turned to India as it is a big, steady supplier of wheat at this point of time.
India guarantees producers about $257 a tonne for domestic sales, while benchmark European wheat jumped above 400 euros ($435) on Monday and benchmark wheat prices in Chicago settled at their highest in 14 years.
India is set to export a record 7 million tonnes of wheat this year. According to reports, India has sealed deals to export about 500,000 tonnes of wheat in recent days. Most suppliers have signed these deals at around $340 a tonne free on board (FOB) to $350 a tonne. Traders earlier sold wheat at $305 to $310 a tonne FOB.
India will also send 50,000 tonnes of wheat to Afghanistan in a bid to help the country facing poverty and hunger since the takeover by the Taliban last year. New Delhi has already sent 4,000 tonnes of the grain to Afghanistan via a land route through Pakistan.
