India Restarts Wheat Export After 4 Years, Price Gap May Cap Demand

India has begun exporting wheat again after a 4-year break, with initial shipments being executed in small volumes, as per The Reuters report.  

The export ban, introduced in 2022 following a sharp fall in output due to extreme heat, remained in place through 2023 and 2024 as domestic supplies tightened and prices rose. 

Shipments Resume from Western Ports 

A consignment of about 22,000 metric tonnes is being loaded at Kandla port for export to the United Arab Emirates.  

The shipment is being handled by ITC Limited and is priced at around $275 per tonne on a free-on-board basis.  

This is the first confirmed shipment since restrictions were eased. 

Export Permissions and Output Recovery 

The government permitted wheat exports earlier this year after an improved harvest helped rebuild stocks.  

Shipments of 2.5 million tonnes were cleared initially, followed by an additional 2.5 million tonnes approved more recently. 

Favourable weather conditions supported last year’s crop, easing earlier concerns over shortages. Speculation about possible imports, which had emerged when stocks declined, has since subsided. 

Price Gap in Global Trade 

Despite the policy shift, Indian wheat remains costlier compared to other exporters. Domestic prices have increased again due to crop damage in some areas, raising export parity levels. 

Supplies from Australia and the Black Sea region are currently quoted at around $290-$300 per tonne, including freight and insurance. Indian wheat is estimated to be at least $20 per tonne higher, limiting its competitiveness. 

Demand Limited to Short-Term Needs 

Higher freight costs, linked to geopolitical tensions involving Iran, have created short-term supply gaps for some buyers in Asia and West Asia. This has resulted in limited demand for Indian wheat. 

Importers with adequate stocks from other origins are unlikely to shift due to the price difference. Buyers seeking shipments within 30 to 45 days are expected to account for most of the demand. 

Read More: Centre Plans ₹37,500 Crore Incentive Scheme for Coal Gasification Projects Promotion! 

Conclusion 

India’s return to wheat exports shows improved domestic availability. However, higher prices are likely to restrict volumes, keeping shipments limited in the near term. 

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