India allows small amount of wheat out after ban, large stock remains stuck

The shipments that have been cleared are mostly to Bangladesh, the Philippines, Tanzania and Malaysia, said a senior government official, who also gave the total.

The ban caused India’s wheat exports to fall to 1.13 million tonnes in May from a record 1.46 million tonnes in April, said the official, who declined to be named.

India, the world’s second-largest wheat producer, imposed a ban on exports on May 14 as a scorching heat wave reduced production and pushed domestic prices to record highs.

(Graph- Indian wheat prices:


Exceptions are allowed for shipments that are secured by letters of credit that have been issued and which are intended for countries that have requested supplies to meet their food security needs.

But even after some of the grain left, at least 1.7 million tonnes were still piling up at ports, three traders from an international trading firm told Reuters.

Prior to the ban, exporters carried unusually large quantities into ports because large harvests were then expected and the government pushed them to replace Black Sea supplies lost to the war in Ukraine.

They expect New Delhi to allow shipments of 8-10 million tonnes or more this year, up from 7.2 million tonnes last year.

“Kandla and Mundra ports have peak wheat stocks,” a Mumbai-based trader told an international trading firm. “Together they hold more than 1.3 million tonnes.”

(Graph – India’s main wheat export destinations:


The government needs to issue export permits urgently because the grain at the port is in large quantities and therefore vulnerable to monsoon rains, said a New Delhi-based trader belonging to an international trading firm.

India receives heavy rains during the monsoon season, from June to September.

“The government has banned wheat exports to ensure food security, but if the stock is damaged by rain, then it won’t help,” the trader said.

Removing grain from ports and moving it to inland cities for local consumption is impractical as traders will incur additional losses on loading and transportation costs, said the Mumbai-based trader.

“The government should allow the export of wheat at the port for government-to-government transactions,” he said.

India has received requests for supplies of more than 1.5 million tonnes of wheat from several countries facing shortages.

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