Quality issues may keep US firms away from wheat import

Companies from the US are unlikely to bid for the fresh 3-million-tonne wheat import tender floated by the State Trading Corporation earlier this week, a US farm department official said on Wednesday. In February, India had awarded a 5,00,000-million-tonne wheat import contract to AWB of Australia.

"The norms prescribed in the recent wheat import tender will make it difficult for US companies to take part in the bidding process," the official said.

According to the tender floated by the State Trade Corporation, imported wheat should be free from 31 weed seeds and pests indicated in the Plant Quarantine Order of 2003.

The tender also stipulates that total foreign matter, damaged, broken and shrivelled grains should not exceed 5 per cent and moisture content should be under 13.5 per cent, while protein content should be at 10 per cent on dry weight basis.

The tender also stipulates that the wheat should undergo methyl bromide fumigation.

"We do not have any problem in meeting the quality specifications but for the in-transit methyl bromide fumigation norm," the official said.

A number of countries have banned methyl bromide fumigation as it leads to depletion of the ozone layer.

"We cannot conform to this (methyl bromide fumigation). Instead, we can replicate the prescribed fumigation procedure with a process called phosphorine," the official said.

The US, which had forecast that India would need to import more wheat, after losing out on the 5,00,000-million-tonne import order to Australia, had stepped up pressure on India to alter quality norms to accommodate more countries in the new tender.

In the new tender, India relaxed some of the norms to broad-base participation by countries keen on selling wheat to India.

The last tender floated by the State Trading Corporation for importing 5,00,000 tonne wheat had received only eight bids, of which seven were rejected as they did not meet quality specifications.

India is importing wheat to replenish fast-depleting buffer stocks. On Tuesday, India lowered what output estimate to 71.5 million tonne in the crop year to June against the previous projection of 73.1 million tonne.