First Imported Wheat Shipments Clear Indian Customs
Fed up waiting for the government to release state-owned wheat stocks onto the market at realistic prices, flour millers in southern India have taken matters into their own hands and begun importing wheat in containers from Australia.
Media reports from India confirm that "a few containers have arrived and they have been cleared by the phyto-sanitary and plant quarantine authorities”.
Suppliers in Australia literally have to clean the wheat before it leaves to meet stringent Indian quarantine restrictions, but with prices fetching USD300-315/tonne (Rs 13,900-14,575/100kg) CIF the southern Indian port of Tuticorin there are plenty prepared to take the risk.
From the flour millers point of view it's a win-win deal, local wheat is costing Rs 15,400-15,800/100kg, availability is tight and what is available has high levels of infestation (typically 5-6%).
When the first few deals were done a risk premium of USD25/tonne was being added by the sellers, pessimistic that the wheat would get customs clearance. Now that the first consignments have got through OK, this has dropped to USD7-8/tonne, with more sellers now coming forward, say millers.
The Roller Flour Mills’ Federation of India is urging the government to relax the strict quarantine regulations until new crop wheat is available in March, to facilitate bulk imports. But for now the government continue to stick their heads in the sand. Their mysterious 27 MMT or so of strategic stocks remains under lock and key, yet neither do they seem prepared to open the doors to wholesale wheat imports.
Media reports from India confirm that "a few containers have arrived and they have been cleared by the phyto-sanitary and plant quarantine authorities”.
Suppliers in Australia literally have to clean the wheat before it leaves to meet stringent Indian quarantine restrictions, but with prices fetching USD300-315/tonne (Rs 13,900-14,575/100kg) CIF the southern Indian port of Tuticorin there are plenty prepared to take the risk.
From the flour millers point of view it's a win-win deal, local wheat is costing Rs 15,400-15,800/100kg, availability is tight and what is available has high levels of infestation (typically 5-6%).
When the first few deals were done a risk premium of USD25/tonne was being added by the sellers, pessimistic that the wheat would get customs clearance. Now that the first consignments have got through OK, this has dropped to USD7-8/tonne, with more sellers now coming forward, say millers.
The Roller Flour Mills’ Federation of India is urging the government to relax the strict quarantine regulations until new crop wheat is available in March, to facilitate bulk imports. But for now the government continue to stick their heads in the sand. Their mysterious 27 MMT or so of strategic stocks remains under lock and key, yet neither do they seem prepared to open the doors to wholesale wheat imports.
