About 800,000 tonnes of wheat from the Black Sea region is expected to arrive in India over September and October as millers boost reserves in expectation of tight domestic supplies, according to two trade sources and trade flows data.
The country is likely to receive 247,000 tonnes of wheat in September, the highest monthly arrival since February, according to Thomson Reuters agricultural flows data, with five vessels scheduled to arrive from Ukraine.
October arrivals are expected to surpass half a million tonnes, said the two traders. They declined to be identified as they were not authorised to speak with media.
"Wheat cargoes which will be arriving this month will be used for consumption in November and December," said one India-based trader. "There is talk that supplies will be tight at the end of the year and prices will go up."
Most deals for the Black Sea wheat have been signed between $200 and $210 a tonne, including cost and freight (C&F). After taking into account 10-percent import duty, the price is similar to quotes for the new-crop local wheat, said a trader with a Singapore-based trading company.
"There is not much price advantage, mills are buying just to ensure the smooth flow of supplies," the trader said.
India started importing wheat last year after two consecutive years of lower production due to adverse weather.
This year, Indian farmers harvested a record 98.38 million tonnes of wheat, up from 97.44 million tonnes estimated in May, data released by the nation's farm ministry showed in August.
Traders say India needs to import wheat for a few years to boost inventories even as domestic production recovers.
Source: moneycontrol.com