October 11, 2005

India might import wheat for first time in six years
 

According to traders and analysts, India, which exported wheat in recent years, might need to import the grain for the first time in six years due to falling stocks and rising wheat prices.

So far, the government has maintained that wheat and rice stocks were comfortable, and rejected speculations that India might import wheat for the first time since 1999.

India's farm ministry has forecast domestic wheat output in 2005 at 72.1 million tonnes, about the same as that of 2004. The next crop would be planted in November and harvested after mid-March.

Analysts said a prolonged delay in a decision on wheat imports could result in the grain's prices soaring.

Currently, India places a 60 percent customs duty on wheat, discouraging private traders from importing. But there were industry speculations that the government might reduce the tariffs.

All India Grain Exporters' Association of India said the government might import up to 2 million tonnes of wheat, to meet demand for public distribution and welfare programmes.

The government said India had 11.3 million tonnes of wheat as of September 1. Human wheat consumption was expected to rise in northern India during the winter months, starting November.

Meanwhile, the government said it had already started replacing wheat with rice to meet welfare programmes in southern and eastern India, where more rice was consumed.