May 3, 2007

India may import 5 million tonnes of wheat

India is preparing to import 5 million tonnes of wheat in an effort to maintain its buffer stock amid projections of a bumper harvest this crop season.  

The importation will be done through public distribution system and other welfare schemes.

The Committee of Secretaries has requested the Department of Food and Public Distribution to "prepare a plan for import of 4 to 5 million tonne of wheat for 2007-2008," adding that the "market survey and identification of suppliers should be done expeditiously so that wheat is imported at the lowest international prices and at short notice as required".

But the immediate importation aims to avail lower prices of US wheat as the department has been asked to secure a certification from the US government.

On Monday (April 30), the State Trading Corporation has started imports for the second year in a row, issuing a tender to buy one million tones from overseas.

Earlier that day, Minister of State for Food Akhilesh Prasad Singh told Parliament that STC would import one million tonne in suitable tranches by July 2007 since there could be "no compromise on food security".

India expects to produce 73.7 million tonnes of wheat in 2007, up from 69.4 million last year. But the abundant harvest however has been hampered by lower procurement by government agencies as farmers are hoarding their stocks in hope of getting higher prices. Procurement, until last week, was estimated at 7.4 million tonnes against a target of 15 million tonnes.