NEW DELHI, INDIA — Due to extreme temperatures, India has lowered the expected wheat forecast from a pre-harvest forecast of 110 million tonnes to 99 million tonnes, according to a report from the US Department of Agriculture’s Foreign Agricultural Service (FAS).
In the 2021-22 market year, the country produced an estimated 109 million tonnes of wheat.
Government procurement is down in the major wheat producing states as open market prices remain well above the MSP offer price of Indian rupees, FAS said. Despite the wheat export ban of May 13, imposed with the intent of bolstering MSP government wheat procurement, there has not been any significant improvement as market prices are still above the MSP offer price in the major production states. Farmers and local traders are holding back larger than normal stock levels in anticipation of price increases in the months ahead, FAS said.
Exports estimates have been lowered to 6 million tonnes due to the export ban. The Indian government will permit wheat exports to continue to neighboring countries including Bangladesh, Nepal, Sri Lanka, and other food security vulnerable countries.
Most trade sources had been expecting India to export about 5 million to 6 million tonnes of wheat and wheat products as Indian wheat is now highly competitive in the nearby region ($50 to $80 lower than other origins), FAS said.
Rice production estimate for 2021-22 is raised to 129.5 million tonnes based on the estimated higher fall harvested production. Increased government procurement and market prices support the higher official rice production estimates, FAS said.
Indian rice exports have been robust since the beginning of calendar year 2020 due to strong demand and competitive prices of Indian non-basmati rice shipped to traditional markets.
Preliminary official trade statistics indicate that rice exports during the first quarter of 2022 are at 5.9 million tonnes compared to 6.1 million tonnes seen last year.