Wheat exports stepped up to cash in on high global prices
The government would soon consider allowing exports of 1.5 million tonnes of more wheat from the official pool, on top of the 2 million tonnes approved in July, so that the process of offloading stocks will not be halted, these sources said.
What has now bolstered expectations of the government, which had approved an estimated export subsidy of Rs 1,263 crore in July to cut overflowing inventory, is that global prices have surged by around 34% since June. Global prices are now significantly higher than the usually more-expensive Indian wheat, thanks to the worst drought in 56 years in Midwest farm belt of the US, and dry spells in parts of other key exporters such as Russia, Ukraine and Australia.
The US department of agriculture recently forecast that global wheat stocks would decline by 13% by the end of 2012-13 from a year ago to post the lowest closing stocks in four years. The International Grains Council also trimmed its forecast for total grain stocks at the end of the 2012-13 season by 4 million tonnes to 328 million tonnes, representing a fall of 12% from a year earlier. This means global