India is currently in final talks to start exporting wheat to Egypt, the world’s largest wheat importer, after Russia's war on Ukraine disrupted global supplies.

 

In a statement published March 21, India's Ministry of Commerce and Industry said that the Indian Agricultural and Processed Food Products Export Development Authority met with stakeholders in mid-March on how to increase shipments to several countries, including Egypt and Turkey. No details were provided on who took part in the meeting.

 

In a press conference on March 24, Egypt’s Minister of Supply and Internal Trade Ali al-Moselhi said that his country is in talks with several countries to import wheat, mainly India, Argentina, the United States and France. He indicated, however, that the country is in no rush to buy at the moment.

 

'There's no need for tenders right now, but we are planning for the entire year so we are open to all possibilities and preparing backup plans,' he added.

 

According to Reuters, Indian suppliers must still get accreditation as an import origin from the Egyptian state grain buyer known as the General Authority for Supply Commodities (GASC).

 

Alex Smith, a research analyst in the food and agriculture program at the Breakthrough Institute in California, told Al-Monitor that India aspires to increase its total wheat exports to about 7 million tons in 2022, its largest quantity ever.

 

According to data from the Indian Ministry of Agriculture and Farmers Welfare, wheat exports from India increased more than fourfold in the 10 months ending on Jan. 31, marking a rise from 1.38 million tons to 6 million tons. The ministry also expects a production increase in the current year to a record 111.3 million tons, compared to 109.6 million tons last year. 

 

'India is not the only potential trading partner for Egypt in light of the disruption of Russian and Ukrainian imports due to the war,' Smith said. Indian imports cannot match the 3.07 million tons of wheat Egypt imported from Ukraine in 2020, or the 8.25 million from Russia. 

 

Egypt needs to search for other sources, Smith added, such as the US and Argentina, and will likely need to build trade partnerships with them, along with India, if the current crisis continues.

 

'India is an important alternative for Egypt to import wheat,' Ali al-Idrissi, a professor of economics at the Culture and Science City in Cairo, told Al-Monitor by phone. 'Egypt has good trade relations with India, and we previously worked with [India] to import rice. India is the best option to bring in wheat now for logistical considerations, including the low cost of shipping.'

 

Although India is the best source in the crisis, 'We cannot deny that Russia and Ukraine are the best options for Egypt, especially in terms of [the shipment fees] and the good quality of wheat,' added , Idrissi, who is also a member of the Egyptian Society for Political Economics, Statistics and Legislation. 'But we are currently facing a [global] crisis and we need to have solutions based on our needs for the next year.'

 

According to a report published by the State Information Service on March 20, the Egyptian-Indian economic and trade relations have remarkably developed in the past years. India is Egypt's third largest trading partner, with Indian investments in Egypt amounting to about $3 billion, according to the report.

 

Egypt's strategic stock plus the local wheat supply will suffice until the end of the year, Idrissi said, but 'things must be resolved right now, and the search for other sources of import must intensify.'

 

During his March 24 press conference, Moselhi said that the wheat stock in Egypt is enough for more than three and a half months, and the local wheat supply season would start in April. He added that Egypt seeks to import from 5.5 to 6 million tons to meet its needs until the end of 2022.

 

Egypt is also planning to call for tenders to buy wheat in the middle of the local harvest season, which usually begins in April and ends in August, Moselhi continued.

 

'Russia’s invasion of Ukraine poses a significant threat to global wheat supplies, and has led so far to higher [global grain] prices,' Smith said. 'Yet, this has not seemingly affected Egypt's food security so far, as Egypt’s grain stock, in addition to the local production, prevented wheat shortages.'

 

Also, he pointed out, the Egyptian government has fixed the price of bread in the market.

 

Shri Piyush Goyal, Minister of Commerce & Industry, Consumer Affairs & Food & Public Distribution and Textiles, invited the business community from the United Arab Emirates (UAE) to come and capitalise on the business-friendly policies and the opportunities that the emerging India is offering to global businesses. 'With the cost and trust advantage that India offers, it is time to invest in India. As partners, we can secure each other’s economic future and strengthen our partnership in the post-COVID world,' said Shri Goyal.

 

Shri Goyal was speaking at India’s Honour Day Celebrations at Expo2020 in Dubai.

 

He said, 'I believe we are now at the cusp of growth and development in the years to come. India provides talent and investor friendly policies. In most sectors, FDI is open 100%. We have several new initiatives to promote industry like the Production Linked Incentive scheme and the Make in India policy, our efforts to provide Ease-of-doing-Business, all of which will lead to ease of living for our people,' he added.

 

'To the global community, I say, 'Come experience India – the land of opportunities'. Let’s grow together, let’s change together, let’s transform together because together we can surmount any obstacles and achieve humongous goals and targets beyond anyone’s imagination,' said the Minister.

 

Shri Goyal said that the new India is fearless and confident where we wish to see the prosperity of every Indian. 'Next 25 years in India will signify a strong and inclusive India,' added the Minister.

 

He said the word ‘trust’ describes India-UAE relationship. 'Our ties will remain vibrant and grow from strength to strength,' said the Minister.

 

Shri Goyal said, 'The special partnership that Prime Minister, Shri Narendra Modi and H.H. Sheikh Mohammed bin Zayed Al Nahyan share is legendary. It’s a bond of eternal friendship symbolising trust and we are natural partners due to the complementary nature of our economies and increasing trade will always showcase the synergy that the two nations have, strengthening further, our bonds.'

 

'Our shared vision which has opened newer avenues, one of which is the commitment to establish an Indian Institute of Technology (IIT) in the United Arab Emirates,' added the Minister.  

 

On government cooperation, Shri Goyal said both the governments supported each other. 'We were the brothers working for each other during COVID,' he said.

 

'The Comprehensive Economic Partnership Agreement (CEPA) is a win-win agreement for the good of the people of both the countries,' he added.

 

On the grand success of Dubai Expo, the Minister said that Expo2020 is victory of courage over adversity. 'The Expo will go down in history as a memorable chapter where the two brothers came closer. It will conclude but the memories will remain. The India Pavilion is going to be a permanent structure; it is not going to be dismantled. It will stand as a testimony to our two countries working towards the collective good of the people,' added the Minister.

 

The India Pavilion, one of the largest and most iconic pavilions at EXPO2020 Dubai, recorded more than 1.6 million footfalls since its inauguration on October 1st last year. The India Pavilion was inaugurated by Shri Piyush Goyal.

External Affairs Minister S Jaishankar met with his Mexican counterpart, Marcelo Ebrard Casaubon, on Wednesday and discussed a variety of subjects, including tight UNSC cooperation between the two nations. In a series of tweets, EAM Jaishankar said, 'Warm and constructive meetings with Mexican FM @m ebrard today evening,' adding, 'Discussed our growing trade and investment, health, science & technology, and space sector collaboration.'

 

The External Affairs Minister discussed UNSC cooperation and even congratulated his Mexican counterpart for taking over the Presidency Alliance. He said, 'Also exchanged notes on our close UNSC cooperation. Congratulations Mexico for taking over the Presidency of the Pacific Alliance. Our regular engagements will continue providing greater energy to our relationship,' Dr. Jaishankar further said. 

 

India-Mexico moving towards a strategic & increasingly close relationship: Casaubon

On the other hand, the Mexican Foreign minister also tweeted and termed the conversation between him and Dr. Jaishankar a cordial one. While talking about the meeting, the Minister said, 'Very cordial conversation about the bilateral relationship, investments, cooperation for drugs and vaccines, the international order and multilateralism. We are moving towards a strategic and increasingly close relationship.'

 

Earlier on March 30, Dr. Jaishankar greeted his Mexican counterpart, who was visiting India for the first time and reiterated his desire to strengthen the India-Mexico friendship. 'Marcelo Ebrard Casaubon is warmly welcomed to India. Continuing the privileged cooperation between India and Mexico,' EAM Jaishankar had put out a tweet.

 

Mexican Foreign Minister on India visit; to travel to Mumbai

 

At the invitation of EAM Jaishankar, the Mexican Foreign Minister is in India for a two-day official visit from March 30 to April 1. In addition, Mexican Foreign Minister Marcelo Ebrard Casaubon will travel to Mumbai. Both Dr. Jaishankar and Casaubon will thoroughly examine bilateral relations as well as discuss international topics of mutual concern.

 

The Mexican Foreign Minister's visit comes after EAM Jaishankar visited Mexico in September last year. This exchange of visits is to help cement and enhance the special relationship between India and Mexico. Mexico is India's second-largest economic partner in Latin America, and it is a member of the United Nations Security Council with India for the years 2021-22.

With participation from Central and State Governments, corporate, and startups, Expo-2020 Dubai is helped the Nation to explore new areas of collaboration for Indian entities and position itself as a global economic hub. India Innovation Hub at the India Pavilion also helped in building on India’s strength as the third-largest incubator of unicorns and has displayed innovations of many Indian startups so far. The platform captured the attention of Indian as well as global investors assisting the startup ecosystem bloom. This platform offered a massive opportunity for exploring business prospects and laying the foundation for future strategic engagements.The expo was meant to showcase India’s potential and strength with respect to different sectors including food and agriculture.

 

Sectors from India participated in the Dubai Expo 2020:

 

1. Millets

2. Organic & Horticulture

3. Technology & Innovations (Digital Agriculture and Startups)

4. Allied Sector (Food basket to the world – Fisheries, Dairy, Meat, Poultry and Ready to Eat/Ready to consume food products)

 

 

The objective of the Dubai Expo event was to showcase countries offering to the world and aims to forge new partnerships & inspire ground-breaking solutions across key industries worldwide.

 

The participation during ‘Food Agriculture and Livelihoods’ theme was also focused upon establishing linkages for the future development in the agriculture and allied sectors. During this period, many meetings were organized with different countries for deepening of relationship and also to explore opportunities for collaboration pertaining to trade development with focus on export, technology transfer, capacity buildings, etc.

 

The senior level delegation from India met with senior officials and investors from - UAE, Myanmar, Zimbabwe, Vietnam, Morocco, Indonesia, and Argentina, UAE is a significant market for agricultural produce from India, the delegation interacted with key officials from the prominent companies like Al Dahra, Grand Hypermarket, Lulu Hypermarket, RNZ enterprises, Choithram group, Aqua Bridge, Sharaf Group, Jaleel holdings, DP World, Transworld etc.

 

Both the Government as well as private sector players explored areas of cooperation in agriculture, food processing, diary & animal husbandry and fisheries sector, in order to boost business and strengthen the trade relation the sidelines of Dubai Expo.

 

This information was given in a written reply by the Union Minister of Agriculture and Farmers Welfare Shri Narendra Singh Tomar in Lok Sabha today.

The Centre has amended the import policy for pulses allowing free imports of tur (arhar/red gram) and urad (black gram) till March 31, 2023. The move is aimed at ensuring adequate supplies at reasonable prices.

 

In a notification, the Director-General of Foreign Trade (DGFT) said the ‘Free Import’ policy of urad and tur shall stand extended up to 31 March 2023.

 

The pulses trade in India and Myanmar, a key supplier have welcomed the move, while the domestic growers are upset, stating it would impact the prices. Tur prices, which were hovering below the minimum support price level of Rs6,300 per quintal, have started inching up in the recent days, while urad ruling above the MSP levels.

 

Bimal Kothari, Vice Chairman, The Indian Pulses and Growers Association (IPGA), welcoming the government’s move said, 'It’s definitely a well planned decision which will benefit the trade and industry as well as consumers. IPGA has been in constant dialogue with the various ministries to recommend a consistent and stable import policy and we are glad that this notification for a 12 month period is a step in that direction.'

 

Further, Kothari said 'We have imported over 22.6 lakh tonnes of pulses in 2020-2021. We still need about 10-12% pulses imports for increased consumption. There were concerns over the scarcity of Tur and Urad which would have impacted the prices. The current prices of Tur and Urad are above MSP. This notification will certainly control the prices to a certain extent. Production of Tur is around 40,00,000 tons and NAFED does not have the stock. Tur is selling above MSP price around Rs67-68. We were expecting the prices to increase but since the imports are opened up, we will be able to import around 2 - 2.5 lakh ton tur from Myanmar. Additionally, the crops from Africa will harvest in August 2022 and the yield is likely to be very good. This will supplement our demand in September which is the festival period in India as our crop will harvest only around December and would have created shortage.'

 

Kothari also said that there is no crop of Urad before September in India and prices have increased t by Rs7-8 per kg in the last one month. 'Burma is the only supplier of Urad to India and they have harvested a very good crop and the production is expected around 7 - 8 lakh tonnes. India imports Urad from Myanmar regularly to meet the gap between demand and supply. Hence the extension of OGL is a strategic move by the government and will help in stabilising the supply and prices,' he added.

 

However, Basavraj Ingin, President of the Karnataka Pradesh Red Gram Growers Association, said the Government’s latest move is against the farmers’ interests and will impact the prices. 'We will press for a change to protect the growers interest,' he said.

 

Modal prices of toor in growing regions such as Kalaburgi, Karnataka ruled at Rs6,000 per quintal, below the MSP level on Tuesday. However, in some markets like Bidar and Raichur the modal prices were above MSP levels. Similarly, the modal prices in Latur and Nagpur in Maharashtra were also hovering above the MSP levels at Rs6,625 and Rs6,338 per quintal, respectively.

 

Shyam Narsaria, President, Overseas Agro Traders Association, Myanmar, said 'OATA Myanmar and all its members applaud and welcome the Indian Government’s proactive step in making this announcement now as the extension of the free import policy will definitely prove an incentive to increase sowing. However, we do hope and pray that the Government adheres to this policy till March 2023 as any sudden change in policy mid-way proves to be disastrous for the farmers and for the trade stakeholders in Myanmar as well as India.'

In order to keep pace with the changing regulatory requirements for export of organic products to European Union, the Agricultural and Processed Food Products Export Development Authority (APEDA) organized a webinar jointly with the Indian Embassy in Brussels and Denmark yesterday.

 

The webinar focussed on the revised Regulations being implemented since 1st January 2022 for imports in EU and the market opportunities for Indian organic products.

 

The European Union is the second major destination for Indian organic food products. Under the National Programme for Organic Production (NPOP), exports to EU stood at $356 million in 2020-21, accounting for around 34% of the $1040 million worth worldwide organic food products exported from India.

 

Organic food products from India are exported to USA, European Union, Canada, Great Britain, Korea Republic, Israel, Switzerland, Ecuador, Vietnam, Australia, etc. In terms of export value realization, Processed foods including soya meal (57%) lead among the products followed by Oilseeds (9%), Cereals and millets (7%), Plantation crop products such as Tea and Coffee (6%), Spices and condiments (5%), Medicinal plants(5%), Dry fruits (3%), Sugar(3%), and others.

 

While complementing the stakeholders on the milestone achieved by India by crossing remarkable export of more than $ 1billion organic products under NPOP, Dr. M. Angamuthu, Chairman, APEDA, emphasized that the applicable standards need to be adhered to in order to maintain the market acceptance by the end consumers and the national regulators. He also stated that APEDA provides possible means for market penetration of new products and brand building through participation in organic food fairs in EU. 

 

In order to address the challenges faced by the Indian exporters in exporting to EU and enhance the share of Indian organic product shipments to EU, a panel discussion was also held with members of OrganicDenmark, Confederation of Indian Organic Industry, International Federation of Organic Agriculture Movements (IFOAM) and Organic Processing and Trade Association (Europe) (OPTA). Technical sessions were led by Michel Reynaud of IFOAM and Aurora Abad of OPTA wherein the aspects on new regulatory requirements and emerging market opportunities were detailed. 

 

In his address, Shri Santosh Jha, Ambassador of India to Belgium, Luxembourg and EU, highlighted the necessity for the market acceptance for organic products, expectation by the importing countries and emerging opportunities for Indian organic products.

 

Ms. Pooja Kapur, Ambassador of India to Denmark, spoke about the current organic market trend focussing on Europe, significance of regulatory system and brand building for India.

 

Though the webinar was aimed for Indian exporters, it witnessed the participation of trade associations in EU, Indian missions of various EU Member States, Certification Bodies, Assessors and officials from various departments.

 

APEDA is the implementing body for the National Programme for Organic Production (NPOP). The programme involves the accreditation of Certification Bodies, standards for organic production, promotion of organic farming and marketing, etc. The NPOP standards for production and accreditation system have been recognized by European Commission and Switzerland for unprocessed plant products as equivalent to their country standards. With these recognitions, Indian organic products duly certified by the accredited Certification bodies of India are accepted by the importing countries. APEDA is also in the process of negotiation with South Korea, Canada, Japan, Australia etc.

 

In 2020-21, India produced around 3496800  Metric Tonne of certified organic products which includes all varieties of food products namely Oil Seeds, Fibre, Sugarcane, Cereals & Millets, Pulses, Aromatic & Medicinal Plants, Tea, Coffee, Fruits, Spices, Dry Fruits, Vegetables, Processed foods etc. The organic production is not limited to the edible sector but also raw cotton, functional food products etc. Among different states, Madhya Pradesh is the largest producer followed by Maharashtra, Karnataka, Rajasthan and Uttar Pradesh. In terms of commodities, Oil seeds are the single largest category followed by Fibre crops, Sugar crops, Cereals and Millets, Spices & Condiments, Pulses, Medicinal plant products, Fruits & Vegetables, Tea, Coffee, Dry Fruits etc.

 

In 2000, the Ministry of Commerce and Industry launched NPOP as the first such institutional mechanism for organic products in India. In 2001, the NPOP was brought under the ambit of Foreign Trade Development and Regulation (FTDR) Act wherein it was mandated that no organic products can be exported unless they are certified under National Programme for Organic Production.

Australia is on the brink of finalizing a free-trade agreement with India with an announcement possible in 'coming days,' as the government works to strike a deal less than two months before an expected May election.

 

Australian Trade Minister Dan Tehan said that he and his Indian counterpart Piyush Goyal were meeting daily and 'getting very close' to reaching a deal. Tehan said he was hopeful that there could be an announcement soon.

 

'Both sides are working feverishly to make sure we can get an agreement that’s in both our national interests,' he said in a Bloomberg Television interview.

 

A free trade agreement between India and Australia has been more than 10 years in the making, with negotiations beginning in 2011 before being suspended four years later in 2015. Finally in 2020, amid warming ties between Delhi and Canberra, Prime Ministers Scott Morrison and Narendra Modi agreed to restart negotiations.

 

Two-way trade between India and Australia was worth A$24.3 billion ($18.3 billion) in 2020, up from just $13.6 billion in 2007, according to the Australian government. Experts have said one of the main sticking points is agriculture, with Australia wanting access to the Indian market, but Modi’s government reluctant to put its domestic farmers - a major vote bank - at risk.

 

The push for an agreement comes just weeks out from the beginning of a national election campaign in Australia, with Morrison’s center-right government pushing a narrative of strong economic management as it struggles to make up ground in opinion polls.

 

Tehan is currently on a visit to the U.S. to meet with Secretary of Commerce Gina Raimondo for the inaugural Strategic Economic Dialogue between the two countries, where they were expected to discuss China’s attempts at trade coercion against Australia and the need to strengthen the supply chains for rare earths.

 

'The traditional rule book is being thrown out the window because we are seeing some countries using their economic weight and their economic power, using economic coercion, using non-market practices, to try and influence global trade,' he said.

 

Speaking on Russia’s invasion of Ukraine, Tehan said he expected Australia to announce further sanctions against Moscow soon.

India's Minister of Commerce & Industry, Consumer Affairs & Food & Public Distribution and Textiles, and Leader of the House in Rajya Sabha, Piyush Goyal said that India's target is $1 trillion goods exports by 2030. 'I would want a larger share of the UAE market in the years to come because for me, the target is $1 trillion of export of merchandise from India by 2030,' added Goyal.

 

Goyal was addressing the business leaders from India and the UAE at an event yesterday along with the UAE Foreign Trade Minister, H.E. Dr ThBin Ahmed Al Zeyoudi and H.E. Dr Ahmed Albanna, UAE Ambassador to India.

 

'We are in the game for around $100 billion each way in the next six to seven years. We are in the game for at least $250 billion bilateral trade. I would like all our industry people to set the timeline. I think it's possible and I come with renewed enthusiasm after having achieved India's historic high of $400 billion plus exports for the first time ever,' said the Minister.

 

Goyal said that despite no tourism, travel, or hospitality services due to Covid, India has achieved a historic high in terms of export of services, close to $250 billion. 'I want services and merchandise to reach a trillion dollar by 2030, and the UAE will play a very, very important role in this,' added the Minister.

 

Speaking on the Comprehensive Economic Partnership Agreement (CEPA) between India and the UAE, Goyal said, 'The UAE-India partnership is the strategic partnership of the 21st century. CEPA agreement between the two countries is not about trade alone, it's about trade in goods and services. It has a huge geopolitical and economic significance and also, in some sense, a great human element.'

 

Goyal highlighted the importance of the agreement as it gives a brand-new direction to the bilateral relationships, be it energy security, food and nutrition security and overall security of the two nations. 'With new opportunities for businesses, job generation, increasing incomes, increasing opportunities for our young boys and girls, our startups, the agreement will set the door for new beginnings and have extraordinary outcomes,' added Goyal.

 

Earlier in the day, Goyal also attended, INVESTOPIA Plenary Session at Dubai Expo which saw participation from H.E. Abdula bin Touq Al Marri, Minister of Economy, UAE, Mukhtar Diop, MD, International Finance Corporation and H.E. Hala El-Said, Minister of Economic Development, Egypt.

 

Speaking at INVESTOPIA, Goyal said, 'We focus a lot on public investments. Our budget this year was largely about government funded infrastructure projects on the back of which we see the multiplier effect helping us on the demand side and that is leading to more investments to meet the supply constraints.'

 

'We have been focusing on improving the lives of the people through public investment on one hand, and on the other hand, ensuring our economic security which includes energy security,' added the Minister.

 

Goyal said, 'We are in a sweet spot where emerging markets have strengthened themselves over the last few years. They will certainly need to be supported if we have to meet the climate goals. We are yet to see the developed world come up with truly practical funding programs.'

Egypt, one of the largest importers of wheat from Russia and Ukraine, to import Indian wheat amid a sharp dip in global wheat production largely due to the conflict between the two countries, said a senior government official.

 

Piyush Goyal, Minister of Commerce and Industry and Consumer Affairs, Food and Public Distribution met the Egyptian minister of Economic Development Hala El-Said on Monday in Dubai where the details of the trade were discussed.

 

In 2020, Egypt imported wheat worth $ 1.8 billion from Russia and $ 600 million worth from Ukraine.

 

India is also looking at increasing its share of exports to countries where it already sends wheat such as Sri Lanka, Bangladesh, Middle East, Yemen, Korea, Philippines, Nepal and Indonesia. At present India’s wheat contribution to these countries’ import basket ranges between 2-10%.

 

'The idea is to increase our contribution to their import basket sharply.' The official said without wanting to be named.

 

The country is also looking at new export destinations like Nigeria which imports around 13 million Tonnes (MT) of wheat from Russia and Ukraine and Turkey which imports 11 MT and Vietnam which imports 4 MT. India’s contribution to Vietnam is 1 % of its total wheat basket while it does not export any wheat to Nigeria and Turkey.

 

A report by State Bank of India (SBI) economists showed that the ongoing conflict between Russia and Ukraine might impact certain high-frequency indicators like financial markets, exchange rate and crude prices in the short term for India. However, amidst the negative clamour, the Indian economy could see a silver lining as it may have the opportunity to fill the vacuum in global trade due to the war. ET's Sachin Dave and Kiran Kabtta Somvanshi explain.

 

India is looking at a wheat production of 11 MT and its central stock of wheat is expected to be 20 MT by the end of March. 'Therefore there is a huge scope to increase exports,' the official added.

 

India is also looking at strengthening the quality check on wheat and certifications in order to bag more orders. The country plans to increase the number of government approved labs with better infrastructure to control certain pests.

 

India produces around 107.59 Million MT of wheat annually and major wheat growing states in India are Uttar Pradesh, Punjab, Haryana, Madhya Pradesh, Rajasthan, Bihar and Gujarat.

 

State governments are also exploring various measures to increase wheat exports. Madhya Pradesh, the second largest wheat producing state after Uttar Pradesh, has called a meeting of exporters to facilitate private wheat procurement for exports.

With maize (corn) prices soaring on demand from West, South and South-East Asia, buyers abroad are switching over to 100 per cent broken rice for animal feed in countries such as Vietnam, Indonesia and China. 

 

'There is a huge demand for maize from Bangladesh, Vietnam, Indonesia besides the Gulf. But prices have surged and availability is low since the new crop will arrive only after next month,' said Bimal Bengani, Managing Director of Kolkata-based Bengani Export Pvt Ltd. 

 

'Shipments of maize have slowed down after prices soared due to the Russia-Ukraine conflict. Instead, buyers from Vietnam and Indonesia are now seeking broken rice,' said M Madan Prakash, President, Agri Commodities Exporters Association (ACEA). 

 

Only small orders taken

 

'Exporters are accepting only small immediate orders that can be shipped in containers. From Kandla in Gujarat, maize is now going to Oman and other Gulf countries, as they are keen on maintaining the feed quality,' said Mukesh Singh, Co-founder of Mumbai-based MuBala Agro Commodities Ltd.

 

A major reason for domestic maize prices increasing is that the kharif crop has almost got exhausted. Singh said maize is currently quoted at ?2,200-500 a quintal against the minimum support price of ?1,870. Demand for maize has increased as supplies from Ukraine, which contributes 16 per cent of global exports, have been cut off with shipments from the Black Sea coming to a total halt after Russian troops entered eastern Ukraine on February 24.

 

Lukewarm demand

 

'Prices of maize delivered in Chennai for exports are ?2,350,' said ACEA’s Prakash. In Gujarat, agricultural produce marketing committee yards such as Dahod, the modal, or rate at which most trades took place, was ?2,300 on Monday.

 

According to the International Grains Council (IGC), Argentina quoted $329 a tonne last weekend, while Brazil offered maize at $364 and the US at $363 (f.o.b) free on board. Currently, benchmark corn futures on the Chicago Board of Trade are ruling at $7.44 a bushel ($292.83 a tonne).

 

'We shipped 250 tonnes of maize to Hong Kong some time back, but after that demand has been lukewarm,' Prakash said. 

 

'There are still some varieties of maize being shipped to Vietnam and Indonesia. A lot of maize is going to Bangladesh by road,' said VR Sagar, Director, Bulk Logix. Bengani and Singh concurred with his views. 'Some exporters are expecting prices to increase to $420-430 and are holding off,' Sagar said. 

 

Exports feasibility

 

Maize is one of the agricultural products whose exports have been good this fiscal, increasing by over 30 per cent in the first 10 months. According to the Agricultural and Processed Food Products Export Development Authority (APEDA), the export of other cereals, in which maize plays a major part, was 3.16 million tonnes (mt) valued at $1.74 billion during April-January this fiscal against 2.37 mt valued at $527 million in the year-ago period.

 

MuBala’s Singh said maize exports were feasible as long as prices were around ?1,700-800 a quintal in the domestic market. Until December, Bangladesh was the top buyer purchasing 1.25 mt, while Vietnam purchased 0.95 mt. 'In view of the high prices, there is good demand for 100 per cent broken non-sortex rice that is commanding a higher price,' said Prakash. The non-sortex rice will have yellow and black coloured grains.

 

Chinese purchase

 

'Even broken rice prices are now quoted near maize prices as there is a shortage,' said Sagar. Broken rice are commanding ?2,100 a quintal and more. An exporter from Bengaluru said 100 per cent broken rice prices were at par with 25 per cent broken white rice. As per IGC data, 25 per cent broken rice price last weekend were $349 a tonne. 

 

According to APEDA data, China, which began importing Indian rice in the last fiscal after over three decades, bought 1.1 mt of rice during the April-December period of the current fiscal and Vietnam 0.6 mt. In October, the US Department of Agriculture said broken rice accounted for 97 per cent of India’s rice exports to China during January-August last year. 

 

'Broken rice has always been going to China and Vietnam over the last couple of years. This year, there is a shortage now,' Sagar said. 'Exports of broken rice could also be a problem in view of the surge in price. We could manage when prices ruled at around ?1,600-700,' he said, adding that the issue now was the grain’s availability. 

 

China began buying broken rice from India to use it as feed after corn prices surged last fiscal. Also, Beijing is required to build feed inventories as part of its plans to increase the production of pigs. Singh said it takes time to accumulate broken rice quantity for exports as they are done in bulk.  

 

A Delhi-based trade consultant said most of the broken rice was heading from the east coast ports such as Kakinada and Kolkata to Vietnam and Indonesia. 

 

'Maize prices will begin to decline once the arrival of the rabi crop beings,' Bengani said. 

 

'Rice prices will begin tapering off once Rabi arrivals begin. This will  happen around mid-May,' said Sagar. 

 

Freight advantage

 

Delhi-based exporter Rajesh Paharia Jain said India has freight advantage to export to China, the Netherlands and South Korea, which had been buying from Ukraine before the conflict intensified.

 

'It is a win-win situation for India after the Russian-Ukraine crisis. As India has a freight advantage of $70-80 a tonne and Chinese demand is up, it would be favourable to India. India maize export share to China might improve,' he said, adding that the coarse cereal exports might increase by 5-7 per cent in 2022-23.