NEW DELHI: India's wheat exports are poised to rise to a record 9.5 million tonne in the current fiscal year as the government is keen to ship out 5 million tonne from official stocks to make space for the bumper harvest.

 

Top officials said private firms would also be allowed for the first time to draw from government stocks to speed up exports as official agencies need to quickly make arrangements for the new harvest and official procurement.

With adverse weather hitting output in major producing nations, exporters expect a good price in the international market. The proposal may come up in cabinet agenda on Thursday.

 

"We need to make room for fresh harvest. We think we can export another 5 million tonne of wheat from the government stock," Food Minister K V Thomas told ET.

 

Currently, wheat from the stocks of Food Corporation of India can be sold only by state-run firms such as MMTC, STC and PEC. "We are working on a mechanism for allowing private players to ship wheat along with PSUs. The process will be transparent so that there is least financial burden on the government," he said.

The country is likely to get yet another bumper crop this year due to favourable weather conditions such as the recent rains in northern India and cold weather since the beginning of this month.

 

The government expects the output to beat last year's record.

 

"If such weather conditions continue, we expect to surpass last year's output of 93 million tonne," said agriculture secretary Ashish Bahuguna.

 

The demand for Indian wheat has gone up amid a fall in wheat production across Australia and Russia. The government has finalised tender for exporting 2.305 million tonne of wheat as against the target of 4.5 million tonne. Of which, around 1.5 million tonne have already been shipped out.

 

Now with the proposal of government opening up options for private players to sell government stock, wheat trading houses are expecting good export numbers.

 

"We are waiting for the government to open the export for private traders. There is a huge stock in the country and we are expecting again a bumper crop of 100 million tonne," said Anil Monga, managing director, Emmsons International Ltd.

 

According to industry sources, contracts for the new crop for April-May shipment were being signed at $300-$330 a tonne. The current demand for Indian wheat was largely coming from Bangladesh, South Korea, the Middle East and African countries.

 

The government has been able to export the grain at an average price of $300 a tonne.

 

"Indian wheat is currently in huge demand globally. We should take full advantage of the situation and export as much as we can," says Pravin Dongre, president, Indian Pulses and Grains Association.

According to agency reports, Chicago wheat gained 5% last week, recording the biggest weekly gain since July as the worsening condition of the US winter crop threatened to squeeze global supplies that have been affected by an adverse weather.

 

A series of rain showers helped ease drought conditions in parts of the United States over the last week but the drought expanded in the parts of the US Plains that produce the most US wheat, according to agency reports.

 

Indian wheat is quoted around $340 a tonne, C&F, in Asia compared with $350-$355 being offered for similar quality Australian wheat.

Weather has affected supplies from Russia and Australia, which are major exporters. Currently, international traders from Concordia, Toepfer, Louis Dreyfus, Starcom, Glencore and Cargill are procuring Indian wheat.