Wheat import likely to surge this year despite sufficient arrivals

The US department of agriculture pegs India's wheat production at 95.85 mt in 2015, as against 93.51 mt in 2014

Despite sufficient arrivals of wheat, belying the fear of crop loss due to a prolonged spell of rain and hail in producing states, the trade says there is a likelihood of high imports .

Flour mills in the southern states have, it is reported, signed contracts for import from Australia of 350,000-400,000 tonnes. "Prices in the international market are historically low and considering the quality issues of Indian wheat this year, this is the right time to import. At this attractive price, the (year's) imports might touch up to two million tonnes, beating the figure for many years," said Parvin Dongre, president, India Pulses and Grain Association.

The landed cost of imported wheat is between Rs 17.90 and Rs 18.30 a kg for the high-grade variety, as compared to Rs 18.50 a kg for domestic wheat.

"The quality took a beating in Madhya Pradesh and Rajasthan (centres of high-protein wheat in India) due to unseasonal rain and hail. We need better quality wheat for bakery products and quick-service restaurants. Wheat drenched in showers is not apt for niche market products," said M K Dattaraj, a Bengaluru-based miller and a senior member of the Roller Flour Millers' Association of India.

For blending and making up for deficiencies in quality, import was the only choice for millers, he added.

"The by-products of wheat, like semolina, cannot be extracted from sub-standard quality. The quality of wheat has been effected. Grain size, loss of lustre, higher moisture content and mud balls make it unusable for millers catering to niche producers," said K S Kamala Kannan, president, Tamilnadu Roller Flour Millers Association.

Uttar Pradesh millers find the cost of imported wheat as much as Rs 20 a kg, costlier than the domestic variety. However, for premium consumers, they might have to purchase the imported variety, said Adi Narayan Gupta, a senior member of the Roller Flour Millers Association of UP.

The US department of agriculture puts India's wheat production at 95.85 million tonnes in 2015, as against 93.51 mt in 2014.

A projection of 705 mt global production in 2015, by the International Grain Council, though down two per cent over the past year, has helped stabilise international prices.