June 7, 2012

India's wheat export sales likely up on Bangladesh demand

Unable to finalise an inter-government deal with Ukraine, Bangladesh has resumed issuing public tenders for imports after a two-and-a-half month hiatus and its fresh demand has boosted India's fledgling export sales of wheat, trading executives said Wednesday (June 6).

India's wheat exports are slow at the moment, but any new demand from Bangladesh will naturally come to India because of the geographical proximity, a trader in Mumbai said.

Ukraine offered 200,000 tonnes of wheat with 10%, 11% and 12% protein around US$305/tonne, US$310/tonne and US$315/tonne, cost, insurance and freight, liner out. In liner-out deals, demurrage costs are borne by the seller. Bangladesh declined the offer, terming the prices too high, and is likely to source its needs from India.

During a ban on Indian exports for more than three years until September, Bangladesh had turned to the Black Sea region and Central Europe to import wheat and a trend reversal is now happening.

In three tenders since March, Bangladesh has bought a total of 150,000 tonnes from India's LMJ International at US$303.90/tonne, US$299.50/tonne and US$288.30/tonne, CIF, liner-out.

Another tender closes Monday (June 4), and traders said prices around US$270-275/tonne, CIF, or even lower may be quoted in the offers. On average, India is exporting around 115,000 tonnes of wheat a month, mostly to the Middle East, a New Delhi-based trading executive said.