India Region

India bans wheat export citing food security

14 May 2022, New Delhi: In a notification released on 13th May 2022, the Indian government prohibited the export of Durum wheat with immediate effect citing food security issues.

The notification mentions that the government had to prohibit export of Durum wheat to honour its commitment to provide food security to the country and to support the needs of neighbouring and other vulnerable developing countries. 

However, the notification also states that the wheat export will only be allowed in two special cases; (1) In case of irrevocable Letter of Credit (LOC) has been issued on or before the date of release of notification, and (2) Permission granted by Government of India to other countries to meet their food security needs and based on request of their government.

The farmers in India have seen a successful marketing season 2022 for the rabi crops sown in November 2021. It was the first time in years that the prevailing prices of wheat in local markets were above the Minimum Support Price (MSP) of Rs. 2,015/quintal announced by the government for cropping season 2021-22. Farmers in Madhya Pradesh were able to sell their produce in local market in a price range of Rs. 2,400-2,500/quintal. Punjab state government had to close MSP procurement centers at various places as there were no arrivals. It was the same case for Madhya Pradesh MSP centres.

The major reason of this higher price is the Ukraine-Russia war which has disrupted the global supply chain. Ukraine farmers have been able so sow about 40% area under agriculture due to the ongoing war and supply issues related to essential agricultural inputs. The scenario may remain the same until the next cropping season. Brazil is expecting a bumper harvest in the coming season and plans to cover up and leverage the prevailing global wheat price.

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