Leading South Korean feed maker Nonghyup Feed Inc. (NOFI) has issued an international tender to purchase up to 130,000 tonnes of animal feed wheat with the Black Sea region among areas excluded as a supply origin, European traders said on Tuesday.

 

The deadline for submission of price offers in the tender is also Tuesday, March 8.

 

Grain importers globally have been hit by the sudden stop to grain exports from Ukraine and a sharp reduction from Russia after the conflict in Ukraine, which Moscow has termed a 'special operation,' closed ports.

 

Chicago wheat futures slid for the first time in seven sessions on Tuesday, with prices falling almost 8%, although losses were limited by concerns over Black Sea supplies amid the Russia-Ukraine conflict. GRA/

The wheat in NOFI’s tender is sought in two consignments of 45,000 to 65,000 tonnes. Argentina, Pakistan, Denmark and China are also excluded as origins.

 

The first consignment is sought for arrival in South Korea between May 1 and June 30 with the seller free to offer shipment options in this period from the United States Pacific Northwest coast, U.S. Gulf, Canada, Australia, South America, India or South Africa.

 

'It looks like importers are having to show a lot more flexibility after the Black Sea crisis caused such disruption to shipments for delivery in coming months,' one European trader said.

 

The second shipment is sought for arrival around July 15.

 

If sourced from the U.S. Pacific Northwest coast, Australia or Canada, shipment is sought between June 12-July 1.

 

If sourced from the U.S. Gulf, shipment is sought between May 23-June 11. If from South America between May 13-June 1, from South Africa between May 28 and June 16 or from India between June 7-June 26.

 

NOFI on Tuesday also issued a new tender to buy 60,000 tonnes of soymeal.

India has signed contracts to export about 500,000 tonnes of wheat in recent days, traders said, cashing in on a sharp rally in international prices and signalling a big uptick in overseas sales from the world's second biggest producer of the grain.

 

Traders said last week they had received inquiries from buyers seeking alternatives to Black Sea cargoes as Russia's invasion of Ukraine threatened supplies from two producers which together account for 30% of world wheat exports.

 

After five consecutive record annual crops, India has large wheat inventories, and traders are keen to capitalise on any export opportunity. A high domestic price guaranteed by the government tends to deter exports unless world prices are high.

 

'The surge in global prices has made it easier for Indian suppliers to meet the rising demand for wheat,' said one dealer at a global trading firm, declining to be named because of company policy.

 

India guarantees producers about $257 a tonne for domestic sales, while benchmark European wheat jumped above 400 euros ($435) on Monday and benchmark wheat prices in Chicago settled at their highest in 14 years.

 

India is set to export a record 7 million tonnes of wheat this year.

 

'The buyers, who are worried about supply disruptions from Ukraine and Russia, know that only India can be a big, steady supplier of wheat at this point of time, and that's why they have turned to India,' the dealer said.

 

India has sealed deals to export about 500,000 tonnes of wheat in recent days, he said. Two other traders, who also did not wish to be named, confirmed the figure.

 

'Most suppliers have signed these deals at around $340 a tonne free on board (FOB) to $350 a tonne,' said trader Rajesh Paharia Jain at Unicorp Pvt Ltd.

 

Traders earlier sold wheat at $305 to $310 a tonne FOB.

 

An Indian government official, who declined to be named, said New Delhi was 'supportive of wheat exports and will facilitate' shipments by private players.

Rajasthan, Gujarat and Karnataka are now among a handful of States that allow free trade outside mandis, without charging any fees for the same, thus kicking off reforms in agricultural trade.

 

In most big States, agri trade is regulated with Uttar Pradesh and Madhya Pradesh issuing licenses and charging mandi fees even for direct buying from farmers. In the Union Territory of Chandigarh, direct buying from farmers is not allowed at all.

 

When the Centre brought in the controversial farm laws, one of the main arguments was to allow farmers 'freedom to sell' anywhere and it was also claimed that the opposition to the reforms were from Punjab, Haryana and western Uttar Pradesh. However, an exhaustive study of current agricultural trade shows that a few States have taken cue from the now-abandoned farm laws and started reforms in trade of farm produce. However, in most States, this remains mired in obduracy to accept reforms.

 

'It is good that States continue to decide on this issue and are not divided on political lines. But, any reforms in agricultural marketing at the all-India level will be dependent on the results of the current Assembly elections in five States. However, what is more important is to make a Central law on inter-State movement of ‘food stuff’ which is under concurrent list and that will facilitate trading,' said former Union Agriculture Secretary Siraj Hussain.

 

Mandi charges

 

Mandis across States charge different fees, cess or user fees and it is uniform everywhere except Gujarat and Maharashtra where the local Agricultural Produce Market Committee (APMCs) are empowered to fix rates, which vary from crop to crop between 0.5 and 6 per cent. For de-regulated commodities, mostly fruits and vegetables, traders and companies are allowed to buy outside mandis without paying any charges. But most of the States collect 1 per cent user charge, collected from buyer, if fruits and vegetables are sold inside mandis.

 

'It (mandi fee) is a revenue model for all the States which they will never want to forego, though they know that it is adding to the overall costs of food items. Besides, the location of mandi is also such that traders who are buying in the mandis are also selling the stuff there itself, mainly in fruits and vegetables as retailers flock there. That is why many States levy user charge for de-regulated stuff since mandi fees cannot be collected from those items,' said Anil Dwivedi, a trader in Delhi’s Azadpur mandi.

 

Chandigarh had received 86,082.10 tonnes of commodities in its two mandis during April-February of the current fiscal, which is higher than the whole of 2020-21. The arrivals dropped nearly 40 per cent last year to 75,752 tonnes from the 2020 levels due to the pandemic. The local administration charges 2 per cent mandi tax.

 

On the other hand, Punjab charges 6 per cent mandi tax (including development cess) on wheat and paddy (non-Basmati) while it is between 1-3 per cent for Basmati, maize, cotton, fruits and vegetables. Haryana charges 4 per cent on wheat, paddy, arhar, sesame and green fodder, and 1-3 per cent on other commodities. Uttar Pradesh levies 1-1.5 per cent mandi fees/user charges (including cess) on all commodities.

 

Hussain said while the direct purchase from farmers should continue, States should also collect data on how much commodities are traded at what prices to frame their policies as the main objective is to help farmers realise better prices for their crops.

In a move towards opening new avenues for paddy farmers in Odisha, an interactive session with different stakeholders for promoting rice export from the State was held recently in digital mode under the chairmanship of Chief Secretary Suresh Chandra Mahapatra from the State Lokseba Bhawan.

 

Principal Advisor to Chief Minister and Chairman of Western Odisha Development Council Asit Tripathy along with senior officers from the Agricultural and Processed Food Products Export Development Authority (APEDA) of India, agricultural scientists and rice exporters participated in deliberations.

 

Considering the paddy production potential of Odisha’s agro-climatic zones, existence of huge genetic diversity of aromatic germplasm, traditional skill of the farmers and availability of port facilities for foreign trading, the Chief Secretary directed to 'create conducive ecosystem for boosting up the export of non-basmati aromatic rice from Odisha'.

 

Asit Tripathy said, 'Odisha as a rice-surplus State has bumper availability for export. There are also rice aggregators who can be trained and mobilised towards export-oriented operations.' He advised the APEDA and the State Directorate of Agriculture to organise ground-level workshops with rice aggregators, food exporters and farmer producer organisations to infuse confidence in farming community for production of export-quality paddy. 

 

The Chief Secretary further directed to adopt cluster approach in promotion of the non-basmati aromatic verities of paddy cultivation. He also asked to identify the agro-climatic zones more suitable for cultivation of such varieties. He said, 'Government of Odisha is committed to enhance farmers’ income by boosting the rice export; and the State will provide all possible support for the purpose.'

 

Mahapatra also asked the Department of Agriculture and Farmers’ Empowerment to constitute a resource team for boosting the rice export.

 

It was decided that the team would visit Andhra Pradesh for gaining exposure to the actual practices adopted in export of non-basmati aromatic verities. The Chief Secretary directed the department to frame a realistic work plan with the suggestions from technical session of the seminar and inputs from the resource team so that those could be carried forward.

 

The requirements like establishment of a laboratory network, creation of a rice warehouse at the Paradip Port, creation of awareness about Indian and global food practices among the farmers, extension of necessary agri-inputs and technical support to the farmers for production of the non-basmati aromatic paddy, etc., were also discussed in the meeting.

 

Additional Chief Secretary and Agriculture Production Commissioner Sanjeev Chopra, APEDA Director Dr Angumuthu and Principal Secretary Food Supplies, Consumer Welfare Vir Vikram Yadav and Rice Exporters. Association President VV Rao participated in the deliberations.

As part of its efforts to address the global supply chain crisis, the Joe Biden administration plans to collaborate with India on building resilient supply chains and promote a transparent rules-based trading system for market economies and democracies, the US Trade Representative has told Congress.

 

In its 2021 Annual Report to Congress, the US Trade Representative (USTR) said the United States and India share a dynamic and important trade and investment relationship. In 2021, the United States and India relaunched the United States-India Trade Policy Forum (TPF), which had not met since 2017.

 

'The United States and India will also collaborate on building resilient supply chains and promoting a transparent, rules-based trading system for market economies and democracies,' the USTR said.

 

When the first wave of COVID-19 hit the world, it caught most businesses off-guard as it disrupted supply chains, especially from China, on an unprecedented scale.

 

Countries like the US and India have highlighted the importance of having a resilient supply chain network that is more robust and diverse.

 

In 2022, USTR will look to the TPF to tackle issues that include the relationship between trade, labour, and the environment, it said.

 

In 2021, the US with India on an ongoing basis in response to specific concerns affecting the full range of the bilateral trade relationship.

 

In November 2021, the two countries relaunched the United States-India Trade Policy Forum (TPF), which is the principal bilateral forum for discussing trade and investment issues affecting the two countries.

 

During the TPF meeting, the United States and India had exchanged views on a broad range of trade concerns and issued a joint statement that highlighted the resolution of certain specific trade concerns and identified areas for future engagement through the TPF technical-level workings groups on agricultural goods, non-agricultural goods, services and investment and intellectual property.

 

These TPF working groups, which include participation by senior-level officials from key US agencies, provide an opportunity to achieve meaningful results and address the general trend of increasingly trade restrictive policies in India that continue to inhibit the potential of the trade relationship.

 

In addition, the United States has indicated that it would engage the government of India in deeper cooperative dialogue on issues in the areas of labour, environment, digital trade, and good regulatory practices, among others. 

The Agriculture Ministry is ready with a new central scheme to promote natural farming in the country with an estimated outlay of Rs 2,500 crore, a senior government official said on Tuesday. The proposed new scheme on natural farming will soon be placed before the Cabinet for approval, the official added.

 

The new scheme has been designed months after Prime Minister Narendra Modi stressed the need to keep looking at alternatives for existing fertiliser and pesticide-based farming while addressing a national conclave on natural farming in Gujarat in December last year.

 

Modi had also said natural farming offers much better products with no side effects.

 

'After several rounds of consultations with stakeholders, a draft scheme on natural farming has been framed in order to promote natural farming with a systematic approach without disturbing the existing systems of farming,' the government official told PTI.

 

The proposed scheme aims to adopt a complementary and cluster approach, to begin with, and will focus on intensive handholding of farmers practising natural farming, marketing of the produce and providing extension services, among other activities, the official said.

 

The objective of the scheme is not the conversion of chemical farming but promoting natural farming in areas where chemical farming has not reached yet. For instance, chemical farming is not much practised in dryland areas, the official said.

 

It may be noted that the government in the Union Budget 2022 has announced the promotion of chemical-free natural farming throughout the country, starting with fields within a 5-km corridor along the Ganga river.

 

According to government think-tank Niti Aayog, natural farming is a chemical-free alias traditional farming methods. It is considered an agroecology based diversified farming system, which integrates crops, trees and livestock with functional biodiversity.

 

In India, natural farming is promoted as Bharatiya Prakritik Krishi Paddhati Programme (BPKP) under the centrally sponsored scheme Paramparagat Krishi Vikas Yojana (PKVY).

 

Niti Aayog along with the Ministry of Agriculture and Farmers welfare had convened several high-level discussions with global experts on natural farming practices.

 

It is roughly estimated that around 2.5 million farmers in India are already practising regenerative agriculture. In the next five years, it is expected to reach 20 lakh hectares - in any form of organic farming, including natural farming, of which 12 lakh hectares are under BPKP, Aayog said on its website.

 

The BPKP programme has been adopted in Andhra Pradesh, Karnataka, Himachal Pradesh, Gujarat, Uttar Pradesh and Kerala.

 

Several studies have reported the effectiveness of natural farming BPKP in terms of increase in production, sustainability, saving of water use, improvement in soil health and farmland ecosystem. It is considered as a cost-effective farming practice with scope for raising employment and rural development, Aayog added.

Food Safety and Standards Authority of India (FSSAI), has stated that the food safety officers can, if required, take the samples of the ‘concerned food article’ even in case of ‘improvement notices’ served to the food businesses under Section 32 of the FSS Act.

 

The FSSAI has stated that the two enforcement sections of 32 (improvement notice), and 38 (drawing of statutory samples of the food article), of the FSS Act may be used in ‘conjunction and harmoniously’, if required.

 

The food authority earlier had clarified that under Section 32 (improvement notices), the lifting and analysis of food samples is not mandatory. Especially when grounds of non-compliance are evident from the product label, advertisement, or when the composition of the said product is not under challenge.  

 

It was also clarified earlier that such food businesses may be granted reasonable time to suitably improve/modify their product label, rectify the advertisement, to strictly comply with the relevant regulatory provisions, failing which further enforcement action shall be initiated against such FBOs as per the provisions under the FSS Act.

 

The objective was to avoid inordinate delay in matters which do not involve food safety and avoiding unnecessary burden on the adjudication system of the states.

 

Now the Food Authority has clarified that these earlier clarifications do not bar the food safety officers from taking samples for analysis.

 

“It is hereby further clarified that the said decision (taken in the 33rd CAC meet regarding improvement notice under section 32 of FSS Act), in no manner bars, or restrict the exercise of powers of Food Safety Officers to lift statutory samples under section 38 of the FSS Act to initiate legal/ statutory proceedings under the Act,” reads the FSSAI notice.

 

The FSSAI has asked the state food authorities that the two sections of 32 (improvement notice), and 38 (drawing of statutory samples), may be used in ‘conjunction and harmoniously’.

Canada’s Minister of International Trade, Export Promotion, Small Business and Economic Development Mary Ng will visit New Delhi later this week, making her the first member of Prime Minister Justin Trudeau’s Cabinet to travel to India in over four years.

 

Ng is scheduled to arrive in New Delhi on Friday for a two-day visit, during which she will meet Commerce and Industry Minister Piyush Goyal.

 

Her visit is part of the renewed emphasis on completing a pair of trade deals between the two nations. A release from Canada’s foreign ministry, Global Affairs Canada, said Ng will hold a hold a Ministerial Dialogue on Trade and Investment. 'India offers extensive opportunities for Canadian businesses and entrepreneurs to introduce their innovative and world-class products and services to a dynamic and growing market,' it added.

 

No Canadian minister has visited India since Trudeau’s ill-fated trip in February 2018.

 

Ng’s visit will be significant in that respect. 'Our government is committed to diversifying trade across the Indo-Pacific region and creating more opportunities for Canadian businesses to export their innovative products and services. Canada and India already share strong trade and people-to-people ties, and I am committed to further strengthening our bilateral commercial relations, including through this women-led virtual trade mission and my upcoming trip to India,' Ng said.

 

Ng spoke to Goyal on February 24 and 'discussed advancing bilateral trade between the two countries and welcomed further engagement on negotiations towards a Canada-India comprehensive economic partnership agreement and a Canada-India foreign investment promotion and protection agreement', according to a statement released then.

 

Ng made the announcement of her visit while inaugurating the first women-only virtual business mission to India hosted by the Asia Pacific Foundation of Canada in partnership with the Canada-India Business Council.

 

Ng and Goyal had met in person on October 12 last year in Sorrento, Italy, on the margins of the G20 Trade and Investment Ministerial Meeting.

Indian wineries are slated to participate in the London Wine Fair (LWF) 2022 after a gap of nearly six years. The decision to participate in the fair took place after a recent meeting of the All-India Wine Producers Association (AIWPA) with the Agricultural and Processed Food Products Export Development Authority Dr M Angamuthu in Nashik.

 

The chairman said that APEDA will participate in various global trade platforms like London Wine Fair, Hong Kong Wine Fair to stabilise our products. 'The Indian wine industry is growing fast and the country produces some of the finest labels in the world. We have to create a niche market with proper backward and forward linkages. Participating in various trade and business fairs will enhance our brand value and competitiveness of Indian wines,' he said.

 

At least 10 wineries will showcase products at the London Wine Fair and APEDA will organise a series of promotional programs for the industry, he said. The London Wine Fair is slated to be held between June 7 to 9. It is widely regarded as one of the world’s most important trade events with over 700 exhibitors and 13,000 wines expected to be showcased at the fair.

 

Jagdish Holkar, president, AIWPA said that India had last participated in the London Wine Fair when the India Grape Processing Board (IGPB) was in existence and after the board was dissolved, there were no such international events and the last two years were lost in the pandemic. Although India is a very small wine player, the objective is to put India on the global wine map and let the world know that we make good wines as well, he said. There is a huge potential for Indian wines in the United Kingdom (UK) and European Union (EU) due to the presence of a large Indian diaspora, several Indian restaurants and interest in Indian food, he said. Indian wines will pair better with Indian food, he felt.

 

Wineries such as Sula Vineyards, Grover Zampa Vineyards and Fratelli are already selling their wines in these markets but the volumes are not known, Holkar said, adding that the presence at the Wine Fair could trigger an interest in Indian wines. The Indian Embassy is also slated to hold promotional events for our wines, he added. Holkar said that the wineries have proposed to participate in the Hong Kong, Dubai, Tokyo and Mauritius wine fairs as well.

Wheat importers face a threat to delivering politically sensitive bread supplies across the Middle East and North Africa (MENA) after Russia's invasion of Ukraine closed off access to the lower priced Black Sea grain they depend on.

 

The ensuing conflict has halted shipping from Ukraine's ports, while financial sanctions have put payments for purchases of Russian wheat in doubt, traders and bankers say, adding another to the risk for governments in the MENA region already struggling with import costs, economic crises or conflict.

 

'Everyone is looking for other markets as it's becoming increasingly impossible to buy stocks from Ukraine or Russia,' a Middle Eastern commodities banker said, citing disruption to shipping, escalating sanctions and rising insurance premiums.

 

'The market is not expecting Ukrainian and Russian exports to resume until the fighting ends,' one trader said.

 

Soaring global prices and possible export restrictions make switching to alternative origins costly, while options for expanding local production in the MENA region are limited by water scarcity and rising input costs.

 

While Gulf countries are protected by fiscal surpluses, other MENA countries, including Egypt and Lebanon, 'remain some of the most vulnerable globally, given the dependence on wheat imports and high household spending on food', Monica Malik, chief economist at Abu Dhabi Commercial Bank, said.

 

Egypt, often the world's largest importer, bought 80% of its wheat from Russia and Ukraine last year, traders said.

 

But since Russia's invasion of Ukraine its state grains buyer has cancelled two tenders due to a lack of offers and high prices, while two cargoes are stuck at Ukrainian ports. read more

 

Egyptian officials say wheat reserves and the upcoming local harvest are enough to provide subsidised bread for around nine months. But they are already expecting to pay up to an additional $950 million in the current budget due to higher prices and could see an erosion of strategic reserves.

 

Egypt's commercial bread market could be at greater risk due to lower stocks, traders said. Prices of local wheat and flour have risen 23% and 44% respectively since the Russian invasion began, Ezzat Aziz of the Cairo Chamber of Commerce said.

 

Algeria, another major buyer, says it has enough grain reserves to last until the end of the year but is readmitting French wheat imports, suspended after a row over France's colonial role in the North African country.

 

'HUNGER'

 

Russia and Ukraine account for about 29% of global wheat exports. But with their supplies in doubt, Chicago wheat futures rose to a 14-year high on Monday.

 

'Importers will have to pay on average 40% more for wheat than before the invasion,' a second trader said.

 

And while Algeria, Libya and oil producers in the Gulf may find higher wheat import costs offset by rising hydrocarbon revenues, other governments have no such cushion.

 

In Lebanon, which is suffering one of the worst economic crises in modern history, wheat reserves stood at just one month as Russia invaded Ukraine. read more

 

In Tunisia, reduced bread stocks, rationing of flour in shops and problems docking wheat imports have raised doubts about official claims that there is enough supply to last until the summer.

 

Meanwhile, Morocco is set to hike grain imports after its worst drought in decades. read more

 

In Syria, whose economy has suffered from years of conflict, a source familiar with the matter said the government could lean on reserves but acknowledged that costs would increase.

 

Poverty and humanitarian needs are deepening. read more

 

'There is local wheat, they will try to produce more but there is a problem of course. Some people won't be able to eat, there will be hunger,' said a Syria-based trader.

 

And there are signs some European countries may limit grain exports after Hungary on Friday announced an immediate export ban, while Bulgaria plans to buy wheat for its reserves, which producers fear may herald such a move.

 

Romania has said it sees no need to restrict exports for now.

 

'The challenging part is countries like Egypt, Morocco or Lebanon who have the double whammy of Black Sea imports (ceasing), and higher prices,' Ahmed Morsy, senior analyst at U.S-based Eurasia Group, said.