India has kicked off wheat exports from government stocks with an offer of 240,000 tonnes, which would be the first such sale in at least four years, as it gradually tries to make space in overflowing warehouses for the next harvest.
India, the world's second-biggest wheat producer, has been struggling to manage bulging stockpiles built up during bumper harvests since 2007. It now risks losing some to rot.
New Delhi stands to benefit from current higher global wheat prices if it manages to seal deals through its three tenders, issued just days after the Indian cabinet approved export of 2 million tonnes of wheat.
"There will be strong interest in the Indian wheat tender because a lot of traders are short on wheat," said a trader with a global trading company in Singapore.
The tenders issued by state-run trading firms MMTC , STC and PEC will close on August 3. Buyers will lift the grain in August and September from Food Corporation of India's warehouses.
On July 1, government stocks amounted to 49.8 million tonnes, much higher than a target of 17.1 million for the current quarter.
India lifted a four-year ban on wheat exports in September, but private shipments from the South Asian nation have picked up only in recent weeks after a rally in global prices and a weaker rupee made Indian wheat competitive in the world market.
Indian wheat is quoted around $290 a tonne free on board (FoB), up from $260 a tonne two weeks ago, traders said.
Copyright Reuters, 2012
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