Rediff.com  » Business » India eyeing Ukraine, Russia's wheat market share in 30 countries

India eyeing Ukraine, Russia's wheat market share in 30 countries

By Sanjeeb Mukherjee
March 26, 2022 10:00 IST
Get Rediff News in your Inbox:

A decision to tap the 30 countries for exporting wheat was taken at a meeting of the commerce ministry on Thursday.

IMAGE: Kindly note that this image has been posted for representational purposes only. Photograph: Harish Kumar/ANI Photo.

India is looking to replace Russia and Ukraine in around 30 wheat-importing countries across the globe, a senior government official has said.

Of these 30 countries, 10-15 are already existing customers of Indian wheat along with that of Russian and Ukrainian varieties.

 

However, India’s share is less in the total volume of imports compared to Russia or Ukraine. That apart, there is another lot of 10-15 countries that have been exclusive buyers of Russian and Ukrainian wheat for decades.

India is keenly eyeing them as well to boost exports either through government-to-government deals or private channels. These include countries like Egypt, Syria, Morocco, Turkey, Azerbaijan, Sudan, Italy, Yemen, Greece and also the North-East African nations, which have seldom bought Indian wheat.

“Our aim is not to be a stop-gap arrangement just for the current crisis but to become a credible long-term supplier of good quality wheat in markets dominated by Russian and Ukrainian wheat. We are not looking at short-term gains but will instead use this opportunity to build long-standing relationships with major wheat importing countries,” Madhaiyaan Angamuthu, chairman of APEDA, told Business Standard.

The top wheat exporting countries are Egypt, Indonesia, Turkey, China, Nigeria, Italy, Algeria, Philippines, Japan, Morocco, Brazil, Bangladesh, South Korea, Netherlands and Spain.

Of these, India has presence in just five nations -- Bangladesh, Indonesia, Philippines, Nigeria and Japan.

Therefore, there is significant scope for India to expand its base among major wheat-importing countries now that Russia and Ukraine are expected to be out of action for the next few months.

Sources said a decision to tap the 30 countries for exporting wheat was taken at a meeting of the commerce ministry on Thursday.

Madhya Pradesh Chief Minister Shivraj Singh Chouhan, whose state has emerged as one of the major gainers from this wheat rush, also participated in the meeting.

The Centre has targeted to export almost 11-12 million tonnes of wheat in FY23. This will be significantly higher than the record 7-7.25 million tonnes expected to be exported in FY22.

However, some traders said, the target of 10-11 million tonnes looks plausible because exports will slow down in the monsoon months due to logistical issues.

“Also, it would be a fallacy to expect that if the Russia-Ukraine crisis gets resolved, then exports won’t start from these countries,” another trader said.

Russia and Ukraine together account for almost 25-30 per cent of the global wheat trade.

Prices of Indian wheat in the world markets had shot up to around $360 per tonne free-on-board (FOB) a few days back in the aftermath of the Russian crisis. However, it cooled down a bit to around $330-$340 per tonne (FOB) in the last few days.

The current price of Indian wheat is still the cheapest among global competitors (where prices have reached even $400 per tonne for some varieties).

The absence of Ukraine and Russia from world markets for the next few months will give Indian traders a golden chance to ship record quantities.

“Such is the situation that some traders are booking cargoes at even $325 per tonne (FOB), which is lower than even corn rates. This shows the desperation to meet the demand,” another trader.

India is expected to harvest a record 111 million tonnes of wheat in 2022-23 (April 2022-March 2023), which is almost two million tonnes more than this year.

Get Rediff News in your Inbox:
Sanjeeb Mukherjee in New Delhi
Source: source
 

Moneywiz Live!