India

Indian wheat exports doubled during the Ukraine war between April and August

According to official data, India exported double the quantity of wheat in the first five months of this financial year than it did in the same period of 2021-22. Although exports have slowed since the abrupt ban announced by the government in mid-May, this is despite a slowdown in exports.

According to Department of Commerce data, India exported 43.50 lakh metric tons (lmt) of wheat from April-August 2022-23, an increase of 116.7 per cent over last year.

The Russian invasion of Ukraine caused a significant spike in demand for Indian wheat in late February. A total of 14.71 lmt of products were exported in April, a 500 per cent increase over the 2.42 lmt of products exported in April last year. The exports for May 2021 decreased to 10.79 lmt due to the announcement of the ban on May 13; however, they were still 164% higher than the 4.08 lmt exported in May 2021.

Following this, exports fell to 7.24 lmt in June, 4.94 lmt in July, and 5.80 lmt in August, as compared to 4.57 lmt, 3.75 lmt, and 5.22 lmt in June, July, and August 2021, respectively.

India exported wheat to 44 countries in April – the most to Bangladesh (3.35 lmt) and the least to the United Kingdom (2,000 lmt). After the ban, the number of national export destinations decreased to 31 in May (Bangladesh remained at the top), and it declined sharply thereafter.

While India exported wheat to 11 countries in June 2022, it exported wheat to only five countries in July (Indonesia, Bangladesh, Korea, the UAE, and Angola), and eight countries in August (Bangladesh, the UAE, Indonesia, Sri Lanka, Afghanistan, Malaysia, Taiwan, and Bhutan).

In the months following the ban, Indonesia emerged as the top buyer of Indian wheat. In this period, approximately 7 million liters of wheat were exported to Indonesia. During the five-month period from April to August, Indonesia ranked second after Bangladesh in terms of Indian wheat exports (8.06 lmt and 11.12 lmt, respectively).

Similarly, the export of atta (wheat or meslin flour) has more than doubled in the first five months of the current financial year – 4.49 lmt compared with 1.64 lmt during April-August 2021. During April-August 2022, Somalia, the UAE, Sri Lanka, Madagascar, and Djibouti were the top five buyers of Indian flour.

The ban on wheat exports comes amid a decline in wheat production of 106 million tonnes, a decline in procurement (18.7 million tonnes versus 43.3 million tonnes last year), and an increase in domestic wheat prices.

There were, however, two types of shipments permitted: exports approved by the Centre to other countries “for the purpose of meeting their food security needs” and “as requested by their governments”; and contracted exports against which irrevocable letters of credit had already been issued.

Wheat and wheat flour prices have increased significantly on the domestic market in recent months. The Department of Consumer Affairs’ website shows the all-India daily average retail price of wheat flour on October 15 was Rs 36.23 per kg, an increase of 18 percent over a year earlier (Rs 30.7 per kg).

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