The demand for Indian wheat, corn, and spices has risen sharply since Russia launched a military operation against Ukraine, the international trade of agricultural commodities was forced to move its sourcing to India as supply from both countries came to a halt.
"In the previous four days, wheat prices at the Kandla port have risen from Rs 2,200 per quintal to Rs 2,350-2,400 per quintal. With the Food Corporation of India (FCI) announcing that its upcoming tender this week will be the final one in March, we believe wheat and wheat products prices will rise much more in the coming week "Former president of the Roller Flour Millers Association of India, Sanjay Puri, said "Only after Baisakhi (April 13) will the next crop be harvested."
The government agency FCI, which does not export wheat, holds the majority of the country's wheat stock. Wheat traders want the FCI to release more wheat into the market, which would assist to control domestic prices, reduce excess stocks, and meet export demand. The processing industry, on the other hand, is concerned. "We will be urging that the government immediately halt wheat exports from the country, as local prices have risen from Rs 21 per kg prior to the commencement of the war to Rs 24 per kg on Tuesday. The export demand is so strong that if we do not halt exports, prices will continue to rise, potentially leading to future shortages," said Anjani Agarwal, president, Roller Flour Millers Association.
Apart from wheat, demand for Indian corn has risen as buyers from India's immediate vicinity have transferred their purchases from Ukraine to India.
"Ukraine used to be a major non-GMO corn exporter. Due to tensions in the Black Sea region and high freight charges, South Asian maize consumption will now shift to India, as no other source can meet this demand "According to the head of an international trade consulting firm who did not want to be named, "In the past two years, India's grain exports have increased as supplies from Myanmar have dropped following the military coup there."
Prices have risen as India's corn exports have increased. Godrej Agrovet's managing director, Balram Yadav, said, "Corn prices have risen from Rs 19.50-20 per kilogramme to Rs 22 per kilogramme at the farm gate. By May, it might either stay the same or fall somewhat."
Spice prices have also risen as a result of local shortages and high worldwide demand. "Coriander seeds are one of Ukraine's most important exports. Coriander prices have risen by nearly 30% in recent months as the crop is smaller" said Ashwin Nayak, the Federation of Indian Spice Stakeholders' founding chairman. "As supplies from the Black Sea region become scarce, we predict higher export demand for Indian coriander."
Due to limited supply and geopolitical concerns, jeera prices have risen by 25-30% in the last four months. Because supply from countries like Afghanistan, Turkey, and Syria have been disrupted owing to geopolitical reasons, India is now the only major supplier of jeera.
Strong export demand for cotton, yarn, fabric, and readymade garments has increased cotton consumption at local spinning mills. Millers claim that an unusual 65 percent surge in domestic cotton prices from around Rs 135 per kg in February 2021 to Rs 219 per kg in February 2022 is making it difficult for exporters to meet their export commitments. The South Indian Mills Association has petitioned the government to approve the import of 4 million bales of cotton to meet high export demand. The poultry sector is preparing to keep soybean costs, which are used in chicken feed, under control.
