by PressAmid the food crisis, demand for wheat from India continues to rise
What causes the demand for wheat: reasons
Geopolitical tensions in the world affect all sectors of the economy. Experts note the demand for wheat from India. It has increased significantly over the past few months. The exporter itself, Food Corporation of India, which announced that it will soon hold the last tender this month, also fuels the excitement. Experts believe that such news can provoke an increase in grain prices.
In addition, poultry companies in India fear higher prices for soybeans. Oilseed crop is used to produce fodder for chickens, and its rise in price will have a negative impact on the factories’ profits. However, experts hope that the government will introduce measures to control the cost of soybeans.
Despite the food crisis looming in the world, India stands a good chance of becoming an export leader. Local producers say that storage facilities have a sufficient supply of grain, and the expectation of a high harvest will greatly expand the supply of Indian wheat.
Now the country has reached the leading position in the sector of grain production, it is second only to China. According to forecasts, India will export about 12 million tons of wheat this season. This way the global market will be able to compensate for the decline in supplies from other countries and stabilize prices.
The growth of grain stocks in India became possible due to the record harvests, which have been observed in the country for 5 years. As a result, local producers have an export surplus, which now covers the shortage on the global market. According to the state food corporation, there are more than 23 million tons of wheat in its warehouses. This figure is three times more than what is needed to ensure the standard level of the country’s reserves. Now India is negotiating with Egypt to supply a large batch of grain. In addition, exporters are signing contracts to sell wheat to China, Sudan, Iran, Turkey, and other countries. In the 9 months, the volume of deliveries from India increased more than 4 times and reached the mark of 6 million tons.
Australia is the main competitor in the wheat export sector for local farmers. However, the price of grain from the latter exceeds the Indian one. It is possible that India may take over Australia’s traditional markets, such as Indonesia.
Earlier analysts talked about the impending food crisis. The reason is a significant reduction in the wheat stocks of major exporters. Currently, reserves of grain in the world market stand at 57 million tons, enough for about a month. Experts have already noted food shortages in the Middle East, which resulted in higher prices of grain and other food products.