India may issue tenders to export 500,000 tonnes of wheat1 min read . Updated: 13 Mar 2014, 03:26 PM IST
Uncertainty over Ukrainian supply driving Indian exports; likely to issue tenders before mid-April
Singapore: India is planning to issue tenders within a month to export up to 500,000 tonnes of wheat, a state-run trading company official said on Thursday, encouraged by higher global prices and expectations of tighter supplies from Ukraine.
US wheat futures climbed to a four-and-half month high on Thursday, adding 8% in three sessions amid uncertainty over grain shipments from Ukraine as the political crisis there continues.
“The government allowed us to sell 2 million tonnes and we have already done 1.5 million tonnes," said the official, who declined to be identified.
“There are plans to issue tenders for the balance 500,000 tonnes before mid-April as prices are attractive now."
Private traders are also aggressively marketing Indian wheat, with exports in the second quarter seen hitting 1 million tonnes, traders said on the sidelines of a grains conference in Singapore.
India’s MMTC Ltd received the highest bid of $281 per tonne for its 80,000 tonne wheat export tender, while PEC Ltd got the highest bid at $282.1 per tonne in its tender, trade sources said on Wednesday.
That compares with a price of $274.9 per tonne PEC fetched in a tender late last month.
Some global trading companies have stopped offering Ukrainian grains for future shipments.
The European Union agreed on a framework on Wednesday for its first sanctions on Russia since the Cold War, a stronger response to the Ukraine crisis than many expected and a mark of solidarity with Washington in the drive to make Moscow pay for seizing Crimea.
“Our company has stopped dealing with Ukrainian suppliers until the crisis is resolved," said one Singapore-based trader at an international trading company.
“It is better to be safe than sorry."
European Union milling wheat futures rallied to a near 11-month high on Wednesday, buoyed by concerns over the political crisis in Ukraine.
Indian wheat crop is likely to hit a record high of around 100 million tonnes, although there have been some concerns over quality with unseasonal rains in Madhya Pradesh and Uttar Pradesh states, which produce high quality wheat for exports.
The crop has suffered only small damage, traders said.
“There could be a slight downgrade in production, maybe around 2 to 3 million tonnes," said a second Singapore-based trader. “The arrival will start in the second half of March."