India Signs Biggest Wheat Import Deals in Over a Decade
Despite an estimated 2015 wheat output of 90 million tons, Indian millers and traders have secured the country’s largest wheat purchases in over ten years.
India’s government officials estimate that the country’s 2015 wheat output will be 90 million tons – almost a 5% drop from 2014, but still easily exceeding demand of 72 million tons – leading to surprize by many about this year’s high import volumes.
Since March, Indian millers and global traders have sealed deals for the importation of 500,000 tons of premium Australian wheat marking the country’s largest wheat purchases in more than ten years.
Rains in February and March have caused concerns among India’s millers over possible cuts to domestic wheat production, especially high-protein varieties used to make foods including pastas and pizzas, spurring an uptick in orders. Low prices then attracted traders such as Glencore, Cargill, and Louis Dreyfus to increase their orders. Another 500,000 tons could be purchased from France and Russia as their harvests approach, however some fear that Russia’s wheat could fall short of India’s quality requirements.
India’s weather office has cut its monsoon forecast for this year to 88% of the long-term average, sparking fears of the country’s first drought in six years. If this year’s monsoon rains end up being inadequate, the country is expected to rely heavily on its large stockpiles, gathered from eight consecutive years of bumper crops.