Egypt and other new markets seek wheat of India

After being well known for exporting terrorism and fundamentalists and funding a host of extremist activities in India, Turkey is now trying to serenade India as it faces a huge food crisis. Reportedly, for the first time, Ankara has been forced to place an order of 50,000 tonnes of wheat from India amid an acute shortage of agricultural products. Reportedly, a delegation of Turkey’s Agricultural and Processed Food Products Export Development Authority (APEDA) has already visited India to facilitate the process and started to buy wheat through private electronic-mandi.

Turkey turning towards India is a significant development as the country’s Islamic President Recep Tayyip Erdogan on multiple occasions has used his position to target India by supporting Pakistan on the Kashmir issue. However, the sky-high inflation and a free-falling economy in Ankara have forced Erdogan to put forth his begging bowl in front of New Delhi – granting the latter huge leverage.

Reportedly, electronic mandi AgriBazaar has received a confirmed order for execution of 50,000 metric tonnes of wheat from Turkey at an approximate value of ₹125 crore.

Amith Agarwal, CEO, AgriBazaar was quoted as saying by the ET, “We cannot divulge the name of the buyer and seller due to a confidentiality clause. Similar enquiries from Egypt, Indonesia and other Middle East countries are currently being received and are being negotiated on our e-platform”

Egypt and other new markets seek Indian wheat

In addition to Turkey, Egypt – one of the largest importers of wheat from Ukraine as well as Russia in April announced that it had turned to New Delhi as its official wheat supplier for the foreseeable future. According to estimates, before the war in Ukraine broke out, Egypt imported wheat worth nearly $2 billion from Russia and $611 million from Ukraine every year. However, Cairo imported only 1 million tonnes of wheat from India.

But that is about to change as the General Authority of Supplies and Commodities (GASC), Egypt’s governmental procurement agency informed about its decision of importing one million tonnes of wheat from India.

Other new markets like Yemen, Afghanistan, Qatar, and Indonesia have also started importing Indian wheat while the USA—expecting production snags due to drought may start looking towards India as well.

Indian wheat farmers have stepped in to fill the void amid the Russia-Ukraine conflict

It is pertinent to note that agricultural commodities have huge demand in global markets as many major agricultural producers are either facing climatic problems or some geopolitical issue. Amid the ongoing disturbances, India has emerged as the trusted supplier of food to countries around the world.

Moreover, ever since Russia invaded Ukraine, wheat futures shot up to a record of more than $14 a bushel, and are now trading at close to $10.92 per bushel (1 Bushel ≈ 30 kgs). Together, Russia and Ukraine make up about 30 per cent of global wheat exports. Russia has been sanctioned, and Ukraine has banned wheat exports. That leaves the world, especially Europe in a very precarious situation.

Private procurers are offering Indian farmers up to ₹ 2,700 a quintal. Therefore, farmers are poised to make an additional profit of close to ₹ 600, because the government procures one quintal of wheat at ₹ 2,015.

Indian PM asking WTO to allow India to feed the world

Last month, Prime Minister Narendra Modi in a public virtual address had remarked that India was prepared to feed the world, only if the World Trade Organisation (WTO) allowed it.

The PM said, “A new crisis has emerged where food security has been threatened. Yesterday (Monday), I had a discussion with the US President and I suggested that if the WTO gives permission, India can supply food grains to the world as soon as tomorrow. We already have enough food for our people but our farmers seem to have made arrangements to feed the world. But we have to live by the world’s rules so I don’t know (if WTO will permit).”

Afterwards, Finance Minister Nirmala Sitharaman remarked that WTO director-general Ngozi Okonjo-Iweala was looking ‘positively’ at resolving the issue that is hampering India’s bid to ship out the wheat from state granaries to other countries that are facing shortages caused by the Russia-Ukraine conflict.

Indian farmers have started harvesting wheat unlike their western compatriots

India has a distinct advantage over other countries when it comes to filling the void that the absence of Ukrainian and Russian wheat supplies has caused around the world. The rabi crop started to arrive at the mandis in the last week of March and the complete harvest is expected to reach the market by mid-May.

Meanwhile, global producers are still waiting for the June-July period to harvest their crops which will only reach the markets by August-September. With this, India has the opportunity to pounce and flood the global markets with its superior wheat.

Breaching the 100 lakh tonne barrier for wheat export

According to a Financial Express report, the country’s wheat exports are likely to cross 100 lakh tonnes (10 million tonnes) during FY 2022-23. The exports have already crossed 70 lakh tonnes in 2021-22 (worth over ₹15,000 crore) as against 21.55 lakh tonnes (over ₹4,000 crore) in 2020-21. The numbers become even more significant when it is realised that up until two years ago (2019-20) the exports stood at only two lakh tonnes (₹500 crore).

There was a time when India had to feed its population using the crumbs thrown at it by rich and powerful countries in the West. The food which was dumped in India was of low quality. Today, that same India is exporting high-quality grains to its enemies and a condescending West – sending a message that you wouldn’t want India to not be in your corner when things get a little south. Turkey should curtail its anti-India activities, otherwise, New Delhi will not waste a heartbeat in taking away the very life jacket it threw its way.