Why is India attempting to increase wheat exports? Is there a wheat surplus in India? Which countries are looking to import the foodgrain?
So far, the story has gone like this: The invasion of Ukraine by Russia and subsequent Western sanctions have harmed wheat exports from the Black Sea region, threatening food security in a number of countries, particularly in Africa and West Asia. The disruption in global wheat supplies has opened up opportunities for India’s grain exporters, especially given the cereal’s domestic surplus availability. Egypt, one of the world’s largest wheat importers, has agreed to source the grain from India, according to Union Minister of Commerce and Industry Piyush Goyal.
What is the status of wheat exports from India?
Russia is the world’s leading exporter of wheat (with nearly 15% market share), and Ukraine is a major producer as well. The war and sanctions have harmed exports from these two countries. Also Read | Ukraine-Russia crisis: global wheat prices at 14-year high, India’s export potential beckon.
This season, India expects to produce 112 million tonnes of wheat. For its food security programs, the government requires 24-26 million tonnes per year. Export opportunities have arisen as a result of the surplus wheat production. Wheat exports are expected to reach 7.85 million tonnes in the fiscal year 2021-2022, up from 2.1 million tonnes the previous year.
Because of the competitive price, acceptable quality, availability of surplus wheat, and geopolitical considerations, more countries are turning to India. While existing importers are increasing their purchases, new markets for Indian wheat have emerged. This fiscal, exports are expected to total nearly 10 million tonnes worth $3 billion.
Which new markets should be expected to buy from India?
The milling quality of wheat produced in India is divided into several grades. As a result, countries in East Africa are likely to source foodgrain from India in addition to Egypt and Jordan. India has sent dossiers to over 20 countries, and talks are ongoing with all of them at various levels. The goal is for each of these countries to resolve the Pest Risk Analysis as soon as possible so that exports can begin.
The Agricultural and Processed Food Products Export Development Authority (APEDA) and the Ministry of Agriculture are also constantly sending delegations to a number of countries in order to address any market issues that may arise.
What is being done to make exports easier?
To help facilitate cargo, the Commerce Ministry has implemented an internal mechanism to support it and get the paperwork ready for the related sanitary and phytosanitary applications.
Wheat is being shipped in full vessel loads and must be transported from the growing areas to the ports. The railways are prioritizing the provision of rakes to move the wheat. According to Tarun Bajaj, director of APEDA, the railways, ports, and testing laboratories, are all prepared to fulfill the standards.
What standards are being used by buyer countries to approve Indian wheat?
To gain market access, countries that have never imported wheat from India insist on the completion of the Pest Risk Analysis. There are also other standards that buyers and sellers share in this area. While Indian suppliers are currently able to meet these requirements, Indian authorities are closely monitoring the situation in order to intervene and negotiate a resolution if any ‘unreasonable’ standards are imposed.
What is the prognosis for the future?
The government is optimistic about the future long-term export prospects for wheat, as well as all cereals, including millets and superfoods. Also Read | Russia-Ukraine conflict: India’s wheat exports expected to exceed 10mt this fiscal year – USDA.
According to trade sources, wheat exports have a bright future if Indian wheat prices remain competitive and geopolitical and weather conditions remain favorable. India has gained the trust of markets like Sri Lanka and Bangladesh. It also needs to establish itself in new markets, which the government should help with.
(Inputs from The Hindu)
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