Wheat exports stepped up to cash in on high global prices

Nov 28 2012, 01:01 IST
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SummaryA big spike in global wheat prices since June has encouraged the government to aggressively step up exports from its overflowing reserves.

officials. The government also intends to keep buyers guessing about the potential export volume in 2012-13 so that global prices don't slump reacting to it, he said.

In the latest tender for exports of 150,000 tonnes, opened late on Monday, STC received the highest bid at $322.22 per tonne from Singapore-based Concordia, while PEC received highest bid at $324 a tonne, trade sources said. The prices are much higher than the floor price of $228 per tonne for exports the government had set in July to offer subsidy. Similarly, another tender by MMTC for export of 50,000 tonnes of wheat, which opened on Tuesday, got the highest bid at $322.13 a tonne, they added.

With these, nearly 1.5 million tonnes of wheat have been contracted for exports from official reserves since July, of which around 800,000 tonnes have been shipped out, the sources said.

US wheat futures scaled their highest in almost two weeks on Tuesday after the USDA said on Monday that the condition of the winter wheat crop affected by rough weather fell to an all-time low for late November. December wheat on the Chicago Board of Trade gained 0.9% to $8.56-3/4 per bushel after hitting a session high of $8.57-3/4 a bushel, its highest since November 14.

Making hay

* MMTC got highest bid at $322.13 a tonne for exports while PEC and STC got bids at $324 and $322.22 a tonne, respectively

* Nearly 1.5 million tonnes have been contracted for exports from official reserves and 800,000 tonnes have been shipped out

* EGoM to consider allowing 1.5 million tonnes more for exports from central reserves, on top of the 2 million tonnes already approved

* Officials hope no subsidy has to be offered as global prices may soar or stay at elevated levels on rough weather in the US and Russia

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