According to traders, India has signed agreements to export about 500,000 tonnes of wheat in recent days, capitalizing on a sharp rise in international prices and signalling a significant increase in overseas sales from the world's second-largest producer of grain.
Traders said last week that they had received inquiries from buyers looking for alternatives to Black Sea cargoes as Russia's invasion of Ukraine threatened supplies from two producers who account for 30% of global wheat exports.
India has large wheat inventories after five consecutive record annual crops, and traders are eager to capitalize on any export opportunity. Unless world prices are high, a high domestic price guaranteed by the government tends to deter exports.
"The rise in global prices has made it easier for Indian suppliers to meet rising wheat demand," said one dealer at a global trading firm who declined to be identified due to company policy.
India guarantees producers about $257 per tonne for domestic sales, while benchmark European wheat prices jumped above 400 euros ($435) on Monday, and Chicago benchmark wheat prices settled at their highest in 14 years. This year, India is expected to export a record 7 million tonnes of wheat.
"The buyers, who are concerned about supply disruptions from Ukraine and Russia, understand that only India can be a large, consistent supplier of wheat at this time, which is why they have turned to India," the dealer explained.
In recent days, India has signed contracts to export approximately 500,000 tonnes of wheat, he said. The figure was confirmed by two other traders who did not want to be identified. "Most suppliers have signed these deals at around $340 a tonne free on board (FOB) to $350 a tonne," said Unicorp Pvt Ltd trader Rajesh Paharia Jain.
Traders previously sold wheat for $305 to $310 per tonne FOB. An Indian government official stated that New Delhi is supportive of wheat exports and will facilitate private-sector shipments.
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