Indian wheat production may reach record 100 million tonnes in marketing year starting April 1 as all-time high domestic prices boost planting, adding to global grain surpluses, agricultural commissioner says
UNITED ARAB EMIRATES
January 10, 2014
– Wheat production in India, the world's second-largest grower, will probably climb to a record as all-time high domestic prices boost planting, adding to global grain surpluses.
The harvest may total 100 million metric tonnes in the marketing year starting on April 1, Agriculture Commissioner J.S. Sandhu said in an interview on Wednesday. Output fell 2.5 per cent to 92.5 million tonnes a year earlier from a record 94.9 million tonnes in 2011-2012, according to the Agriculture Ministry.
Crop prices from wheat and corn to canola are slumping as record harvests from the US to Brazil expand global grain inventories. The Standard & Poor's GSCI Index of eight crops fell to the lowest level since July 2010 on Wednesday, extending its biggest annual drop since 1981. Record output may force India to accelerate exports from state reserves to make room for the new crop, extending a decline in global food costs tracked by the United Nations.
"Exports from India will pressure global prices," said Vedika Narvekar, chief manager at Mumbai-based Angel Commodities Broking Pvt.
"Exports will largely depend on the crop in the US and Russia. Domestic prices will be stable."
Wheat futures tumbled 22 per cent in 2013 as world production climbs by 8.4 per cent to a record 711.4 million tonnes versus consumption of 699.3 million tonnes, according to the USDA. Futures fell to $5.8675 a bushel yesterday, the cheapest since December 2011, and were at $5.8825 in Chicago.
Prices in India rallied to all-time high on December 27 after the government increased the minimum price for farmers to a record. The February delivery contract fell one per cent to Rs1,640 ($26.4) per 100 kilogrammes (£220) on the National Commodity & Derivatives Exchange Ltd in Mumbai.
"The international market is not very promising at least for next six months," said Abdolreza Abbassian, a senior economist at the UN's Food & Agriculture Organisation.
(c) 2014 Khaleej Times. All Rights Reserved. Provided by Syndigate.info, an Albawaba.com company