More wheat to be imported in India, Despite Bumper Harvest

India, the second largest producer and also the second largest consumer of Wheat in the world has continued to feel the requirement of wheat imports from countries like Australia, France, Ukraine etc. According to sources, about 3 lakh tonnes of imports have already been contracted with Ukrainian suppliers. Despite a good monsoon and a bumper harvest India is still expected to import up to 4 million tonnes of wheat this fiscal year due to several reasons.

The first reason to start with is the sluggish supply of domestic high protein wheat. Secondly, the wheat available in the international market is way cheaper than the domestic prices and it is when the government puts 10% of duty on the imports. The landed cost of imported wheat is about Rs 18/kg, while the domestic wheat price is Rs 20/kg. Thirdly, the wheat producing states in India lies mainly in the northern and central belts of the country. And the southern states find it cheaper to import the wheat from international market than getting it from the upper states. Another thing to be noted here is, India produced a record 96.6 million tonnes of wheat in 2017 as compared to 92.3 million tonnes in the previous year, the availability in the open market has not improved significantly mainly because the government procured more to refill its depleted stocks.

The procurement of wheat as on July 7 for the Rabi marketing season (RMS) 2017-18 is up by 34% to 308.01 lakh tonnes against the procurement of 229.62 lakh tonnes in the corresponding period of RMS 2016-17. The ending stocks in the central pool had depleted from 15.5 million tonnes in 2015-16 to to 13 million tonnes in 2016-17. However, trade sources say that the import of superior quality of wheat that comes from Australia may not be much this year as the price is high.