No imports needed: India wheat harvest defies speculation
INDORE: A strong wheat harvest in India is rapidly replenishing stocks, meaning the country will be able to meet domestic demand without imports this year, contrary to market talk that it would need overseas supplies, and a potential drag on global prices. India banned exports of the staple in 2022 and extended the prohibition as extreme heat shriveled crops again in 2023 and 2024, draining reserves, pushing prices to record highs and fuelling speculation it would need imports for the first time since 2017.
But things are improving for the world's No.2 wheat producer, with early state inventory purchases signaling that this year's crop is about 4 million tons bigger than last year's, six industry and government officials said. 'After barely scraping through without imports in recent years, the country finally seems to be out of the woods and free from the fear of having to import wheat,' said Amit Takkar, chief of New Delhi-based farm consultancy Conifer Commodities.
The Food Corporation of India, the state stockpiler, has bought 29.7 million metric tons of new-season wheat from domestic farmers - the most in four years - after missing procurement targets for three consecutive years. FCI's total wheat purchases could rise to 32 million-32.5 million tons this year, food minister Pralhad Joshi said earlier this month, adding to the 11.8 million tons in stock at the start of the marketing year on April 1. That stockpile of roughly 44 million tons would significantly exceed FCI's annual requirement of 18.4 million tons to run the world's largest food welfare program, which provides free grain to nearly 800 million people.
FCI's surging wheat stocks are sufficient to dispel the prospect of imports that has kept the global trading community guessing, the six industry and government officials said. With the world's second-largest wheat consumer not needing imports, global prices Wv1 for the grain are likely to come under pressure, as output remains strong in top exporting countries such as Argentina, Australia and Canada, while import demand from top consumer China has weakened. Global wheat prices have more than halved from the record highs of 2022, sliding earlier this month to their lowest level in nearly five years.
Imports averted
Better weather, higher-yielding climate-resilient seeds, and adequate soil moisture from last year's plentiful monsoon rains helped improve this year's wheat output in India. A nearly 15% rise in wheat prices over the past year - driven by consecutive poor harvests - also encouraged farmers to switch to wheat.
Farmers in the central state of Madhya Pradesh, known for premium wheat that goes into pizzas and pastas, said crop yields were higher this year thanks to a milder March. 'The weather was better this year compared to last year,' said farmer Sunil Dubey, as he steered his tractor trolley brimming with brown sacks of wheat into the dusty, bustling wholesale market of Indore. Dubey and many other farmers have sold their entire harvest to the FCI this year. FCI's robust stockbuilding means that it can release wheat onto the open market in the event of a domestic price spike.
In the fiscal year to March 2024, the FCI released more than 10 million tons of wheat into the open market - a record - to tame rising prices. However, lower inventories prevented it from selling large quantities the following year, and Indian wheat prices jumped to an all-time high in early 2025. The government is now far more confident about domestic wheat supplies and prices. India has no plans to lower or remove the 40 percent wheat import tax, nor is it considering importing wheat through diplomatic channels, as it had discussed earlier, said a senior government official.
'Because of good production and procurement, we have ample quantities in hand,' said the official who declined to be named, citing government rules. 'There will not be any imports.' At the same time, India is not considering allowing exports, the official said, preferring instead to build stocks. The government has forecast this year's output at a record 115.4 million tons, although the Roller Flour Millers Federation of India has pegged production at 109.63 million tons. Both estimates were made before the April harvest.
In 2024, India produced 105.85 million tons of wheat, according to the flour millers' body, below the government's 113.29 million tons figure. Trade and industry officials have in recent years said the farm ministry's wheat output estimates are overly optimistic and create market uncertainty. 'Despite our conservative estimate, we know that production will be around 4 million tons higher than last year,' said Navneet Chitlangia, president of the Roller Flour Millers Federation of India. - Reuters
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Kuwait Times
2 days ago
- Kuwait Times
Airline chiefs meet in India amid turbulence of Trump
NEW DELHI: Airline bosses meet from Sunday in New Delhi at their annual industry conference, battling to mitigate the impact of Donald Trump's policies that have hit travel to the United States and potentially raised costs for aviation. Trump's bid to impose tariffs on the United States' trading partners have upended commercial flows, with legal challenges against his plan adding to uncertainties. The tense atmosphere in the United States, from Trump's plans to revoke foreign students' visas to reports of travelers detained at US borders, has also put a dampener on tourism. 'The airline sector is always sensitive to the economic and political climate,' Paul Chiambaretto, professor of strategy and marketing at France's Montpellier Business School, told AFP. 'Any form of uncertainty will reduce traffic,' he added, noting it 'especially' impacted business travelers, the most profitable segment. The influential International Air Transport Association (IATA) is due to update its traffic and profitability projections as the delegates from the group gathering 350 airlines hold their talks. In December it forecast a record 5.2 billion air journeys in 2025 - up 6.7 percent from an already unprecedented 2024. It predicted carriers would generate $36.6 billion in cumulative net profit, on revenue exceeding $1 trillion. However, the US president's 'Liberation Day' tariff blitz and his administration's stance on issues from immigration to education could throw a spanner in the works. Putting up the 'closed' sign As early as March, the North American air transport market, which represents 23 percent of global traffic, began to decline and several US-based airlines warned they would not meet their financial targets. A study released this month by the World Travel and Tourism Council and Oxford Economics found that the United States was on track to lose some $12.5 billion in revenue from foreign tourists this year owing to worries about travelling to the country. The group, made up of leading travel firms, said this 'represents a direct blow to the US economy overall, impacting communities, jobs, and businesses from coast to coast'. 'While other nations are rolling out the welcome mat, the US government is putting up the 'closed' sign,' WTTC president Julia Simpson said. Didier Brechemier, an airline industry expert at Roland Berger, said: 'Today, bookings for the North Atlantic are lower than they were at the same time last year.' IATA Director General Willie Walsh noted on Thursday 'some signs of fragility of consumer and business confidence with continued weakness in the US domestic market and a sharp fall in North American premium class travel'. Air transport has for decades benefited from the removal of import taxes, rising living standards — particularly in Asia — and open borders, with the number of air trips tripling since 2000. But the return of protectionism is endangering the industrial model of aircraft manufacturers, whose assembly lines mobilize suppliers worldwide, with costs likely to increase, putting more of a burden on carriers. — AFP Lower energy costs There's good news for carriers, though, with oil prices falling owing to an anticipated slowdown in economic growth. That could help firms reduce their fuel bills—representing between a quarter and a third of their operational costs—by hundreds of millions of dollars. Washington's new Republican administration is also fully supporting the development of fossil fuels, in contrast to that of Democratic former president Joe Biden, who subsidized Sustainable Aviation Fuel (SAF). Sustainable development 'has largely disappeared from the airline industry's immediate priorities', says Jerome Bouchard, a partner at consultants Oliver Wyman. Also likely on the agenda for IATA will be the impact of geopolitical tensions on the industry. India is experiencing explosive growth, with the number of airports and passengers in the world's most populous nation doubling over the past decade, while major airlines IndiGo and Air India have hundreds of aircraft on order. Prime Minister Narendra Modi is expected to address delegates on Monday, organizers said. The country's recent deadly spat with neighbor Pakistan, which saw the two sides impose airspace bans on each other, highlighted the fragility of civil aviation in the face of such upheavals. The row poses an additional complication for connections to Asia, as Russia has banned US and EU aircraft overflights in retaliation for sanctions linked to its invasion of Ukraine.- AFP
Arab Times
4 days ago
- Arab Times
Panama to allow controversial mine to export already mined copper to fund maintenance
PANAMA CITY, May 31, (AP): Panama will allow a controversial mine that was closed after months of protests to export more than 120,000 tons of already mined copper concentrate to pay the costs of maintaining the inactive mine site, government officials announced Friday. Opposition to the massive copper mine led to some of Panama's most widespread protests in recent years before the country's Supreme Court rejected a deal that allowed a Canadian company to operate it. Toronto-based First Quantum Minerals said Friday that exporting the material that's sitting at the site will fund maintenance and environmental protection measures. Panama's President José Raúl Mulino called for those steps in March, when business groups were lobbying him to reopen the mine. Income from the mine accounted for nearly 5% of Panama gross domestic product the last year it operated. "The purpose is to avoid, above all else, environmental damage,' Trade and Industry Minister Julio Moltó said Friday. He emphasized that the mine was not reopening, but said that the plan would ensure the site remained safe. The open-pit mine was temporarily closed in 2022 when talks between the government and First Quantum broke down over payments the government wanted. In March 2023, Panama's Congress reached an agreement with First Quantum, allowing subsidiary Panama Copper to continue operating the mine in a biodiverse jungle on the Atlantic coast west of the capital for at least 20 more years. The deal faced opposition from those who believed Panama wasn't getting as much as it should and from environmentalists and Indigenous groups who raised concerns about the mine's impact. Protests included a blockade of the mine's power plant. Protesters also blocked parts of the Pan American highway, including a stretch near the border with Costa Rica. On Nov. 28, 2023, Panama's Supreme Court ruled unanimously that the 20-year concession was unconstitutional and then-President Laurentino Cortizo announced the start of a process to close the mine.
Arab Times
4 days ago
- Arab Times
Trump tells US steelworkers he's going to double tariffs on foreign steel to 50%
WEST MIFFLIN, Pa, May 31, (AP): US President Donald Trump on Friday told Pennsylvania steelworkers he's doubling the tariff on steel imports to 50% to protect their industry, a dramatic increase that could further push up prices for a metal used to make housing, autos and other goods. In a post later on his Truth Social platform, he added that aluminum tariffs would also be doubled to 50%. He said both tariff hikes would go into effect Wednesday. Trump spoke at US Steel's Mon Valley Works-Irvin Plant in suburban Pittsburgh, where he also discussed a details-to-come deal under which Japan's Nippon Steel will invest in the iconic American steelmaker. Trump told reporters after he arrived back in Washington that he still has to approve the deal. "I have to approve the final deal with Nippon and we haven't seen that final deal yet, but they've made a very big commitment and it's a very big investment,' he said. Though Trump initially vowed to block the Japanese steelmaker's bid to buy Pittsburgh-based US Steel, he reversed course and announced an agreement last week for "partial ownership' by Nippon. It's unclear, though, if the deal his administration helped broker has been finalized or how ownership would be structured. Nippon Steel has never said it is backing off its bid to outright buy and control US Steel as a wholly owned subsidiary, even as it increased the amount of money it promised to invest in US Steel plants and gave guarantees that it wouldn't lay off workers or close plants as it sought federal approval of the acquisition. "We're here today to celebrate a blockbuster agreement that will ensure this storied American company stays an American company,' Trump said as he opened an event at one of US Steel's warehouses. "You're going to stay an American company, you know that, right?' As for the tariffs, Trump said doubling the levies on imported steel "will even further secure the steel industry in the US.' But such a dramatic increase could push prices even higher. Steel prices have climbed 16% since Trump became president in mid-January, according to the government's Producer Price Index.
