Russia and Ukraine account for roughly 25% of global wheat exports. However, Russia's invasion of Ukraine and the subsequent Western sanctions imposed on Moscow have severely reduced their wheat supplies. As a result, many countries that previously sourced wheat primarily from these two countries are now in desperate need of alternatives.
India, the world's second-largest wheat producer after China, is said to be eyeing the void. The government intends to allow more exports in order to capitalize on the higher price of wheat on the international market.
Food security advocates, on the other hand, emphasize the importance of prioritizing local prices and ensuring adequate supplies for domestic consumption before deciding on the number of exports.
Minimal Exports
Between 2017 and 2021, Russia and Ukraine exported 183 and 91 million tonnes (MT) of wheat, respectively, while India exported only a small portion of its output or 12.6 MT. The European Union (157 MT), the United States (125 MT), Canada (112 MT), and Australia accounted for the majority of wheat exports during this time period (83 MT).
India, which had the second-highest wheat supply (including production, existing stocks, and imports) in this period -613 million tonnes-exported only 2% of this, with the rest consumed domestically and stored. Other major exporters, on the other hand, may be able to sell significant portions of their supply. For example, the United States exported 31% of its 404 MT supply from 2017 to 2021. Canada exported 60.5 percent of its 186 MT supply, while Australia exported 57 percent of its 146 MT supply.
Global Market
Many African, West Asian, and Southeast Asian countries rely heavily on Russian and Ukrainian wheat. Egypt, the world's largest wheat importer, gets 93 percent of its wheat from its East European neighbours. Indonesia, the world's second-largest importer, is 30 percent dependent on these two countries.
African nations such as Sudan (80% reliance), Tanzania (64%), Libya (53%), Tunisia (52%), and West Asian countries such as Lebanon (77%), Yemen (50%), and the United Arab Emirates (42%), are also heavily reliant on supplies from the two neighbours currently at war.
According to APEDA (Agricultural and Processed Food Products Export Development Authority) chairman Dr. Madhaiyaan Angamuthu, India is now focusing on exporting wheat to many of these countries. "Our target markets include Egypt, Turkey, Nigeria, Algeria, the Middle East, Indonesia, Vietnam, Sri Lanka, Bangladesh, Thailand, the Philippines, Morocco, and Tanzania," he added.
"APEDA has created a task group to give impetus to wheat export promotion as well as to bring focus on the challenges and bottlenecks faced in production and export," Dr. Angamuthu explained.
With India's wheat harvesting season (March to May) coinciding with the supply crunch, a bumper crop expected this year, and significant buffer stocks, food security activists agree that India is well-positioned to step in and fill the void. They cautioned, however, that India should not lose sight of its domestic needs while exporting surplus wheat.
Domestic Needs
The Indian government should prioritize price stability and grain availability for internal consumption, while also ensuring that farmers are adequately compensated, according to Dipa Sinha, Assistant Professor at Delhi's Ambedkar University's School of Liberal Studies.
"The government's first priority should be to meet the food security needs of all Indians," said Dr. Sinha, who was involved in the Right to Food campaign. "This would necessitate the continuation of the PDS [public distribution system], the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY), as well as the expansion of the net to include more people who are currently excluded." This is also critical given that market prices are expected to rise further. However, with higher prices available, the government should consider purchasing wheat required for these food security requirements from Indian farmers at a lower price than the current MSP," she added.
"The government should plan this move so that it has no impact on local consumption. A bumper crop of wheat is expected, allowing the government to meet its distribution and buffer needs. Furthermore, there are currently no export restrictions, so farmers can benefit from higher prices by selling surplus to private traders for exports" Dr. Sinha expressed his thoughts.
Boosting Farm Revenue
Former Principal Adviser to the Commissioners of the Indian Supreme Court in the Right to Food case, Biraj Patnaik, observed that the peace clause adopted at the World Trade Organization's Bali Ministerial in 2014 does not preclude India from exporting food grains.
"With the buffer stocks on hand, India should increase its wheat exports to the greatest extent possible in order to stabilise global prices," Patnaik said. "It is also significant because countries that rely on Russia and Ukraine for wheat are looking for an alternative source." "The government should take advantage of this opportunity by purchasing all of the wheat grown at M.S.P., which would benefit Indian farmers," he added.
