Wheat prices are at a nine-year high on the global market, ranging between $9 and $10 per bushel. The Chicago Board of Trade quoted benchmark wheat futures at $9.75 per bushel, or $358.24 (27,150) per tonne, on Tuesday.
Indian wheat exporters have signed contracts to export at least 5.5 lakh tonnes (lt) in the coming months, as countries in South Asia, South-East Asia, and West Asia look to New Delhi to meet their food and feed needs in the aftermath of the Ukraine-Russia crisis.
“We have a demand for Indian wheat from March to April.” 5.5 million tonnes have been agreed upon by our exporters. Exporters will ship both old and new crop under these agreements,” said Rajnikant Rai, Divisional Chief Executive, ITC Agri-Business.
“Russia and Ukraine account for 35-40% of global wheat exports,” an ITC official said.
According to FAOSTAT, Russia exported 37.26 million tonnes (mt) of wheat and Ukraine exported 18.06 million tonnes (mt) of wheat in 2020, out of a total of 202.48 million tonnes (mt) exported by various countries, including India.
“The wheat market is volatile, with buyers and sellers waiting to see what happens.” However, as the Ukraine crisis worsened, prices rose by $15-20 per tonne. “India has an advantage in that no other country’s new crop arrives at this time of year,” said Nitin Gupta, Vice-President, Olam Agro India Ltd.
Wheat prices in the global market are at a nine-year high, with rates fluctuating between $9 and $10 per bushel. On Tuesday, the Chicago Board of Trade quoted benchmark wheat futures at $9.75 per bushel or $358.24 (27,150) per tonne.
“We’ve seen strong demand for Indian wheat in recent months.” “We are also approaching parity in grain shipping,” Mukesh Singh, Director of MuBala Agro, said.
Countries in South Asia, West Asia, and even the Philippines in the South-East Asian region are interested in Indian wheat, according to Rai of ITC. “Even South Korea buys Indian wheat for feed,” he says.
According to Olam’s Gupta, India could easily ship out 3-4 mt by June of this year, especially given that 5-6 lt is exported each month. “In December, we exported nearly one million tonnes,” he said.
According to data from the Agricultural and Processed Food Products Export Development Authority (APEDA), India exported 50.41 lt of wheat worth $1.43 billion from April to December of this fiscal year, up from 10.69 lt worth $278 billion lt the previous year.
Until November, exports stood at 41.14 lt. The per-tonne realisation was $280 until November, but it increased to $285 in December. Bangladesh purchased 29.68 lt of Indian wheat in the first nine months of this fiscal year, followed by Sri Lanka (4.04 lt), the UAE (3.69 lt), and the Philippines (2.96 mt).
Wheat exports have aided growers this year, with prices exceeding the minimum support price (MSP) of $1,975 per quintal announced for the rabi marketing season in 2021. This year, the MSP has been increased to $2,015 USD.
“If the conflict between Ukraine and Russia continues, Indian exports will benefit.” Ukraine and Russia both have bumper wheat crops. “However, if the current trend continues, exports will be good until June-July,” Rai forecast.
“For the next 30 days, we’ll have to keep an eye on the weather.” “If there is no rain,” Rai predicts, “we will have a good crop.” Increased stockpiles at the Food Corporation of India also help Indian wheat exports. As of February 1, FCI had 28.27 mt of wheat on hand, compared to 31.83 mt at the same time last year. It is currently estimated to weigh around 26 million tonnes.