Singapore: India is likely to ease control over wheat exports and sell up to 2 million tonnes of the grain this year, but the government will take a decision after assessing crucial monsoon rains in July, a leading trader said on Thursday.
“We expect a decision after July,” said Vijay Iyengar, managing director of Singapore-based trading company, Agrocorp International.
“It will be positive for exports going by the huge stocks they are holding, unless there is a substantial delay in monsoon rains and production issues.”
He said Pakistan, which is also looking to export wheat, is likely to ship out up to 700,000 tonnes.
India is sitting on burdensome stocks of wheat after 4 years of bumper production, raising hopes among top Asian buyers, including some of its neighbours, of supplies from the country.
The bulk of storage space has been filled after a series of strong harvests coincided with a ban on exports, but the government has been reluctant to lift trade curbs as it faces protests against rising food prices.
Iyengar said the government is expected to make a call in July, which is a crucial period for the development of summer sown grain and oilseed crops.
“Initially they are talking about exports to neighbouring countries. But most Asian countries have experienced Indian wheat, so if its price is competitive there will be a lot of interest,” he told Reuters in an interview.
India’s wheat stocks stood at 35.2 million tonnes as on 1 June, nearly nine times the government-set target of 4 million tonnes, while the rice inventory was at 25.3 million tonnes, sharply up from a target of 12.2 million tonnes.
In neighbouring Pakistan the situation is similar, with a second straight year of bumper harvests estimated at around 24 million tonnes.
“There is talk that Pakistan may come out with wheat as well, traders there are talking about 600,000 to 700,000 tonnes,” said Iyengar.
“Pakistan may sell wheat even earlier than India.”