July 11, 2007

India to buy only half of issued wheat tender

The State Trading Corporation (STC) in India will only import 511,000 tonnes of wheat, half of the 1 million tonne wheat tender that had been issued by the country to boost its domestic supplies.

The STC received seven bids from firms last week, including Alfred C. Toepfer, Cargill Inc., Concordia Agritech, Glencore AG and Louis Dreyfus of France, to sell a total of 920,000 tonnes of wheat at between US$320-US$360 a tonne (including some levies).

The government previously turned down the tenders due to high prices. The government also pleaded the firms to lower the prices but to no avail. Thus, India decided to buy half the amount for US$317 and US$330, according to an official.

India, the world's second largest producer of wheat, is importing the grain for the second year as it consumes around 72 million tonnes annually. It imported 5.5 million tonnes of wheat in 2006 and is projected to produce more than 73 million tonnes in 2007, up from 69.48 million tonnes last year.