June 27, 2006

Australia sells 500,000 tonnes of wheat to India

Australia's wheat exporter, AWB Ltd, said on Tuesday (Jun 27) it sold 500,000 tonnes of wheat to India in a new contract, bringing the total sales of wheat to India in recent months to 1 million tonnes.

Disputes over quality in the previous contract have also been resolved, the company said.

AWB has been involved in protracted negotiations with Indian officials after exports in a 500,000 tonnes contract in March were marred by Indian complaints about pesticide content. Only 90,000 tonnes of the contract have so far been shipped.

AWB was also notably absent from a new wheat tender launched by India recently. 

The two contracts supplying India with 1 million tonnes of Australian wheat is good news for the national pool, AWB's spokesman Peter McBride said in a statement.

Although AWB does not reveal prices, the two contracts for the total of 1 million tonnes of wheat is estimated to be worth around US$190 million.

India relaxed rules on moisture content and fumigation in recent weeks after securing only 800,000 tonnes of wheat from a 3 million tonne tender floated in May.

Execution of the new contract for 500,000 tonnes would start shortly, with shipping to take place over the next four months, AWB said.