* Farmers set to harvest seventh straight bumper crop
* Stocks at state warehouses substantially higher than
* State-run traders get good response in their export
By Mayank Bhardwaj
NEW DELHI, Jan 16 India is likely to soon permit
more wheat exports as the world's second-biggest producer of the
grain looks set to harvest a record crop this year, government
sources said, swelling stockpiles in an oversupplied world
The South Asian nation is extremely cautious about allowing
exports of wheat, a staple for its 1.2 billion population, and
lifted a four-year-old ban on shipments in 2011 by allowing only
private traders to sell on the world market.
But a succession of bumper crops and poor storage conditions
that have led to substantial wastage have prompted a rethink on
exports. Since last fiscal year India has exported nearly 4.5
million tonnes of wheat from state warehouses, and state-backed
traders are now selling another 2 million tonnes via tenders.
Any extra supplies from India, though, could dampen Chicago
prices which have fallen around 9 percent in the past
month due to rising global supplies. Leading producer Ukraine
has already raised its 2013 grains output forecast to a record.
"In all likelihood, the crop is going to be an all-time high
so more exports are almost certain now," said an Indian
government source directly involved in the decision-making
process. "But we are yet to take a call on the quantity to be
Of the 2 million tonnes of wheat currently allowed for
exports from government warehouses, state-run traders have
already sold almost a million tonnes.
Three government-backed traders - State Trading Corp.
, MMTC Ltd and PEC - are getting good
response in their tenders after the government in October cut
the floor price for exports to $260 a tonne to boost shipments.
Any decision on additional exports could come in March.
"Most likely a formal decision for more exports will come
when another one million tonnes will be sold out. By then, we
will also get a clear idea about the crop size," said another
government source who is also a decision-making authority.
Indian farmers grow only one wheat crop in a year, with
planting in October-September and harvests from March.
This spring farmers would harvest more than 100 million
tonnes, Farm Minister Sharad Pawar said on Wednesday, the
seventh consecutive wheat crop to exceed demand. In 2013, India
produced 94.88 million tonnes.
A jump in the area planted with wheat and favourable weather
conditions are the main reasons behind expectations of a record
crop in the country which needs 76-77 million tonnes of wheat a
year to feed its population.
Farmers have planted wheat on a record 31.14 million
hectares, up from 29.65 million hectares in the previous year,
said Indu Sharma, chief of the state-run Directorate of Wheat
Research in Haryana, a major wheat growing state.
"Crop condition is excellent. Colour is good. There are
signs that the crop will be more than 100 million tonnes,"
The Indian government buys grains from local farmers at
fixed prices to protect them from any distress sale and build
stockpiles to sell subsidised food to the poor. Bumper harvests
mean more stocks at government warehouses.
On Jan. 1, wheat stocks at state-run warehouses were 28.0
million tonnes, substantially higher than a target of 8.2
(Editing by Jo Winterbottom and Muralikumar Anantharaman)