India says it will keep a window open to export wheat to food-deficit countries at government level despite an export ban announced on Friday
India’s Commerce Secretary, BVR Subrahmanyam, told reporters that the government would also allow private companies to meet their previous pledges to export nearly 4.3 million tonnes of wheat until July. India exported 1 million tonnes of wheat in April.
India mainly exports wheat to neighboring countries like Bangladesh, Nepal and Sri Lanka.
A notice published in the Official Gazette by the Foreign Trade Directorate on Friday said a surge in world wheat prices threatened food security in India and neighboring and vulnerable countries.
One of the main purposes of export restrictions is to control rising domestic prices. World wheat prices have increased by more than 40% since the start of the year.
At the same time, India’s wheat crop has been hit by a record heat wave that is slowing production.
He said India’s wheat production this year was down three million tonnes from last year’s 106 million tonnes. Wheat prices have soared 20-40% in India.
“The current price rise appears to be a panic reaction rather than a reaction based on a real supply collapse or a sudden demand explosion,” Subrahmanyam said.
Although it is the world’s second largest producer of wheat, India consumes most of the wheat it produces. It had set a target of exporting 10 million tonnes of grain in 2022-23, seeking to capitalize on global disruptions in wheat supplies due to war and find new markets for its wheat in Europe, in Africa and Asia.
Up to 90 million tonnes of wheat were consumed in India last year out of a total production of 109 million tonnes, Subrahmanyam said, adding that India exported 7 million tonnes of wheat last year.