India exploring imports of wheat

Faced with acute shortage, India is exploring imports of wheat from Canada and Europe.

India had sought to buy 1 million tonnes of wheat in May last but backed could not strike a deal because of high prices. However last week, India entered the market with a tender for 1 million tonnes, despite prices soaring to 11-year high.

According a senior government official, wheat is available in France and Canada. If India does not enter the market now, it may not get any wheat at all, he expresssed the apprehension.

Wheat from Australia will not be available till November while US wheat suppliers will not be able to meet New Delhi's tender specifications.

Union Agriculture Minister Sharad Pawar has said India would need to import 5 million tonnes of wheat between August and December.

However, traders expect India to import less because of big purchases from its own farmers.

Analysts expect the government to buy at least 2 million tonnes of wheat before December. Traders expect India to receive bids for the latest tender at around $320 a tonne, including cost and freight, about 20 per cent higher than prices of around $263 it received for its May tender.

Analysts expect little respite in global prices in the near future because of fall in the world stocks due to erratic weather disrupting the US harvest, and drought in Ukraine and Russia.

The government needs 13 million tonnes of wheat to meet the country's need for subsidized sales and welfare schemes.

India produces about 70 million tonnes of wheat annually and most of it is consumed by its a billion-plus population.