Several wheat-importing nations are looking to buy the staple from India, while Indian exporters too are vying with US, Argentina and China to seal record export opportunities following the Ukraine crisis, officials and traders say.
A particularly lucrative country for Indian exports could be Egypt, the world’s largest wheat importer. The African country however has no immediate shortage and therefore will look for cheapest sources of supply, said a representative of a large Indian trading business, requesting anonymity.
Egypt expects to float tenders after its harvest in April, but it will surely need to meet its import “shortfall”, the trading house said. Indian exporters will need accreditation with an Egypt’s supply authority.
Commerce and food minister Piyush Goyal met Egyptian minister for economic development Hala El-Said during an investment meet in Dubai on Tuesday, where he assured India’s readiness to help the African nation, the official said.
Egypt imports about some 5 million tonne, mostly from Russia and Ukraine, and maintains a reserve buffer of another 5 million tonne.
A delegation from Egypt is likely to visit India, an official said, to fix grade, quality and price. Egypt depends mostly on Russia and Ukraine for its wheat imports. The two nations at war together account for up to 30% of global wheat exports.
{{/usCountry}}A delegation from Egypt is likely to visit India, an official said, to fix grade, quality and price. Egypt depends mostly on Russia and Ukraine for its wheat imports. The two nations at war together account for up to 30% of global wheat exports.
{{/usCountry}}A key constraint is rising global shipping costs which have increased over 60% than a year ago, according to Drewry’s Composite World Container Index, a benchmark of shipping freight costs.
Iran and west and east Africa nations are eyeing deals with Indian exporters, the official said.
“Egypt doesn’t face an immediate crisis because it maintains a wheat buffer, but it has to replenish its stocks because it is a net importer,” Surjit Singh of Hira Impex, an exporter, said.
India is capable of supplying between 7-12 m tonne that can plug a gaping hole in global supplies due to Russia’s invasion of Ukraine. The war in Ukraine has presented a rare opportunity for India to profitably export large quantities of wheat from its stockpiles, as global prices have surged above the domestic minimum support price.
The central government is pushing to fill the gap, asking diplomatic missions to facilitate outbound shipments, food secretary Sudhanshu Pandey told HT last week. India is set to export a record 7 million tonne of wheat this year, higher than the previous record of 6.5 million tonne in 2012-13.
At 14%, India’s share in global wheat output is roughly equal to combined share of Russia and Ukraine.
The war has pushed up international Chicago benchmark for wheat to nearly $13 a bushel (approximately 30kg) from about $5 from a month ago.