February 12, 2008

 

India exploring options to buy wheat from Russia and other CIS countries

 

 

India is now exploring the option of buying wheat on a government-to-government basis from countries in the former Soviet Union other than Kazakhstan, a senior government official said Monday (February 12, 2008).

 

At an industry event last week, officials India would not be in need of wheat imports for the year but would need to strengthen their buffer stocks.

 

Some analysts estimate India would need 3 million tonnes of wheat this year. Last week, the government expected a 1-million tonne decline of the wheat harvest this year to 74.81 million tonnes. 

 

A senior official from a state-run trading firm said India is looking to buy around 300,000 tonnes of wheat from Kazakhstan.

 

"All these negotiations are at a very initial stage and nothing can be said with certainty how far they will be successful, but yes the government is exploring other countries apart from Kazakhstan," the official said. "Russia is one option which India is looking at apart from Kazakhstan for purchasing wheat."

 

Federal farm secretary T. Nandakumar had told reporters on the sidelines of an industry event in Bangalore last week the federal government is exploring all options and is not focusing on one country for such imports.

 

The official however, clarified discussions are moving slowly as most countries want to sell wheat to India at current market prices and not at any concession.

 

India had entered into contracts to import around 1.8 million tonnes of wheat in the financial year that ends in March because of low stocks after procurement by state agencies failed. Until December around 1 million tonnes of the contracted wheat had already arrived in India.

 

"Although there is no need for wheat imports at least for the next two to three months because of comfortable stocks and harvest of the new crop, the federal government is keeping its options open," Nandakumar had said in Bangalore last week.

 

Officials said India's wheat closing stocks as on Apr. 1, is expected to be around 5.3 million tonnes, around 1.3 million tonnes more than the usual buffer requirement of 4.0 million tonnes.

 

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