By Pratik Parija, Bloomberg
New Delhi: The world’s second-biggest wheat user, received seven bids for a one million ton tender as India imports the grain for a second year to replenish reserves, a government official said.
State Trading Corp., (STC) a government-run company, will buy wheat in lots of 25,000 tons, 50,000 tons and 75,000 tons for delivery at Chennai, Vishakhapatnam, Kakinada and Tuticorin ports in southern India and Mundra and Kandla in the west. The tender closed today. Names of bidders and prices offered were not immediately known.
India is buying wheat for a second year to boost reserves as demand exceeds production. The purchases come at a time when freight rates have climbed to more than a two-year high as China and India, the world’s two most-populous nations, buy more grain and iron ore. Wheat prices have advanced 11% in the past year as bad weather damaged crops from US to Australia.
State Trading invited bids on 30 April and bids are valid till 30 May. The grain is to be supplied between 1 June 1 and 15 August. Details of the bidders and prices were not immediately known.
India’s wheat imports may total 5 million tons this year, farm minister Sharad Pawar said on 12 May. Output may exceed 73.7 million tons. That may not be enough to cover demand forecast to reach 75.5 million tons as rising incomes spur consumption of breakfast cereals and biscuits.
The government has purchased 9.73 million tons of wheat from farmers this year compared with 9.2 million tons a year earlier, according to the farm ministry. Purchases may total 10 million tons, below the government’s target of 15 million tons, the US Department of Agriculture said on 30 April.
Wheat futures for July delivery rose by 1% to $4.7550 a bushel in after hours trading on the Chicago Board of Trade.