Food Min for cut in wheat export floor price to $260/tonne

The Food Ministry has moved a Cabinet note proposing a reduction in the floor price of wheat by $40 at $260 a tonne to make exports viable and clear surplus stocks.

The revision in reserve price has been proposed as global buyers quoted $260-267 a tonne for recent bids, as against the benchmark price of $300 a tonne set for export of two million tonnes of the grain from the state-run Food Corporation of India (FCI).

"Since the bids received were lower than $300 a tonne, the Committee of Secretaries has recommended a reduction in the floor price for wheat export to $260 a tonne," Food Minister K V Thomas told PTI.

The Food Ministry has moved a proposal for Cabinet's consideration, he added.

In August, the Cabinet Committee on Economic Affairs (CCEA) had approved 2 million tonne wheat exports from FCI godowns for this fiscal subject to a floor price of $300 per tonne through STC, MMTC and PEC.

So far, wheat has not been exported from FCI, which is under pressure to clear space for new crop. As on October 1, the FCI had a wheat stock of 36 million tonnes against the requirement of 21.2 million tonnes.

In 2012-13 fiscal, the government had earned $1.4 billion from export of 4.2 million tonne wheat by PSUs. Indian wheat had fetched an average price of $311.38 per tonne.