India's booming wheat exports have become a lot less bountiful lately due to unclear government policies and logistical bottlenecks, traders said on Friday.
They said exporters have not signed fresh sales contracts since the middle of December since the government stopped issuing poorer quality "lustre-lost" wheat from its stockpiles for export, pending an assessment of available grain stocks.
India was aiming to export about 4.2-4.5 million tonnes of wheat in 2002-03 (April-March), about 70 per cent of which is lustre-lost wheat that buyers in South Korea and South East Asian countries like for feed wheat.
It was also eyeing Iraq and Iran for big wheat exports.
India began exporting wheat two years ago to cut bulging grain inventories, built up after successive good harvests. Stocks have come down because of that and a higher allocation of grains to feed people in drought-hit states.
"Wheat exports have come to a standstill. No fresh contracts have been signed in the past 20 days because there is no clarity in the government's export policies," said Apurv Dave, a senior official with Ahmedabad-based Adani Exports, a leading exporter.
He said exporters were fulfilling only old commitments because a lack of railway wagons to move the grain to ports had delayed shipments.
Since November, the government has allocated more railway wagons for domestic food distribution in areas where there were shortages, traders said.
Slow exports
"The government is not issuing any lustre-lost wheat for fresh exports, but it is also not saying that it is banned," said another leading official in an export firm, adding there were rumours the government might stop exports altogether.
Some traders said the government was deliberately slowing down the process, but doesn't want to ban exports.
"The government feels that the exports started two years ago have brought down the stocks, which it thinks is now at comfortable levels," said Gagan Gulati of export firm GTC Holdings.
Gulati said the government has periodically raised the export price of wheat, delayed issue of wheat from its stocks and denied railway wagons to move the grain.
But a food ministry official said India had plenty of grain stocks, much above the required buffer of 16.8 million tonnes.
The official said as on December 1, India had grain stocks of 51.5 million tonnes, including 31.3 million of wheat, against 59.1 million tonnes of grains on that date last year.
Traders said the Food Corporation of India, the state-owned grains agency which issues wheat to exporters from its stocks, was physically verifying the stock position and will take a decision soon on issuing wheat to exporters.
Dave said if the government wanted exports to continue it should cut the price of its good quality wheat to make it globally competitive.
"If that (price cut) does not happen, wheat exports will die a natural death, government won't have to put a stop to it."
(Additional reporting by Thomas Kutty Abraham in Ahmedabad)