Egypt clears Indian wheat, trade negotiations on with more nations

Updated on Apr 16, 2022 12:33 AM IST

India has accelerated efforts to export wheat shipments from its massive domestic stockpiles amid a global shortage sparked by the war

India has accelerated efforts to export wheat amid a global shortage sparked by the Ukraine war. (Sameer Sehgal/Hindustan Times)
India has accelerated efforts to export wheat amid a global shortage sparked by the Ukraine war. (Sameer Sehgal/Hindustan Times)

Egypt, the world’s top wheat importer, has approved India as a supplier to fill a sizeable void in the north African nation’s food stocks due to the Ukraine conflict, a move that will open up a lucrative market for Indian farmers and also deepen agricultural ties between the two countries, officials said on Friday.

India has accelerated efforts to export wheat shipments from its massive domestic stockpiles amid a global shortage sparked by the war.

Egypt, which has traditionally relied on cheap Ukranian and Russian wheat supplies to meet domestic demand, approved Indian wheat varieties after a visiting delegation from that country toured Madhya Pradesh, Punjab and Maharashtra to ascertain quality, storage and other export parameters. The two nations at war together account for up to 30% of global wheat exports and nearly 80% of Egypt’s imports.

On Friday, Union commerce minister Piyush Goyal tweeted: “Indian farmers are feeding the world. Egypt approves India as a wheat supplier. Prime Minister Narendra Modi’s government steps in as the world look for reliable alternate sources for a steady food supply. Our farmers have ensured our granaries overflow and we are ready to serve the world.”

India, the world’s second-largest wheat producer, is currently in “discussion with various countries including Egypt, Turkey, China, Bosnia, Sudan, Nigeria, Iran, etc for commencing wheat exports”, an official said, requesting anonymity.

India has stepped up efforts to seize a rare global opportunity to ramp up wheat shipments as international wheat prices are currently ruling higher than domestic minimum support prices.

The new farm exports could push India’s export earnings, which hit a record $418 billion ( 31.4 lakh crore) during 2021-22. Farmers are expected to reap higher prices, as analysts expect domestic grain prices to rise on the back of exports.

“We are further targeting a US$ 300-400 million export revenue that will not only aid small scale farmers to garner better prices for their crop but also the central government in terms of income and reduction in forced procurement of certain commodities,” said Fauzan Alavi, director of Allana Group, India’s largest wheat exporter.

A food ministry official estimated India could export up to 10 million tonne depending on global demand.

While India readies to export its excess wheat stocks in anticipation of another bumper crop, farmers are concerned over an apparent fall in yields this year due to very higher temperatures from an early summer.

“We have received reports of wheat yields dropping in entire northern India. There may be a 15-20% drop due to terminal-heat problem, especially during March,” said Karnal-based Rajinder Singh, a retired agriculture scientist with Haryana government, who now works on climate change at the All-India People’s Science Network.

Terminal-heat problem refers to damage to maturing wheat crop from heatwaves, which can destroy ripening grains. Harvesting is currently under way in major growing regions, including Punjab, Haryana, western Uttar Pradesh, Rajasthan and Madhya Pradesh.

If the yield drop is large, then “we could end up with the lowest output in 15 years”, Singh said, adding that this could lower India’s export potential.

An official said quality standards were being stringently applied to food-testing laboratories. The railways and commerce ministry are working to ensure additional rail wagons to deliver to ports for speedy exports, he said. Port authorities have also been asked to accord priority to wheat shipments.

The visiting Egyptian delegation of the general authority for supply commodities, agriculture and supply ministry examined wheat grain samples during their field visits. Egyptian Ambassador to India Wael Mohamed Awad Hamed accompanied the delegation, a second official said. The Egyptian team inspected Indian phytosanitary measures, which refers to safety of food stuff, before clearing India’s accreditation as a wheat-import origin country.

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  • ABOUT THE AUTHOR

    Zia Haq reports on public policy, economy and agriculture. Particularly interested in development economics and growth theories.

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