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Govt has no plans to lift the ban on wheat export as prices in India still high

Govt has no plans to lift the ban on wheat export as prices in India still high

Govt has no plans to lift the ban on wheat export as prices in India are still high.

The Indian government has no plans to lift the ban on exporting wheat, but it is in the process of reviewing letters of credit for shipments that were made before May 13, when the ban went into effect. A source who has been following the issue said that the total number of approvals is likely to be around 2.1 million tonnes (mt).

The recent grain deal between Russia and Ukraine, in which Russia agreed to unblock certain Ukrainian ports to allow the export of wheat, corn, and other cereals, is likely to reduce the pressure on India to lift its ban on wheat exports, according to a source who spoke to a news agency. This is because international wheat prices are likely to become less volatile.

Also Read | Despite ban on exports, Indian wheat prices rose to a record high.

‘The Directorate General of Foreign Trade (DGFT) is almost done with the verification process for LCs issued before the wheat export ban was announced. The last few cases, involving about 2 lakh tonnes of wheat, are being dealt with. Most likely, around 2.1 million tonnes of approvals will be given. No one has talked about lifting the ban on exporting wheat yet,’ a source has told.

India, on the other hand, is willing to sell wheat to its neighbors and other countries that are facing threats to their food security. After the ban was announced, it had already sent shipments to Bangladesh, Oman, and Afghanistan, among other places, a source said.

The DGFT banned wheat exports from India on May 13, 2022, because they were worried about a possible shortage in the domestic market. Production in the country had been hurt by an unusually hot March, and domestic prices were also going up.

Production saw even lower

‘The Centre doesn’t plan to look at the wheat export ban again just yet because prices at home are still very high. There are signs that the actual wheat production for the 2021-22 crop season, which ended in June, was likely lower than the official estimate of 106.41 mt, which was lower by 4.41% than the previous estimate of 111.32 mt,’ the source said.

Also Read | India’s wheat export ban made global food market even more unstable: WTO.

The government said it would allow shipments for which letters of credit were issued before May 13 even though it banned wheat exports. But there were a lot of requests and online applications from traders asking for permission to export more than 5 mt of wheat. This caused the DGFT to set up a process with a lot of checks and balances.

‘In the end, less than half of the applications for pending exports could prove that the LCs were both issued and sent before the ban,’ the source said. This means that about 2.1 mt will be allowed to leave the country.

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