The costly flip side of India becoming an important wheat exporter

The costly flip side of India becoming an important wheat exporter

The conflict in Ukraine has led to more countries looking to India for their wheat supply.

But production of wheat in India has fallen, primarily due to recent severe heat waves.

This has caused wheat prices in India to soar by up to 20%, which has in turn impacted consumers.



India exporting wheat to more parts of the world is putting upward pressure on its domestic prices.

Before the Russia-Ukraine war broke out, India, the second-largest producer of the foodgrain, only accounted for 1% of global exports. The conflict has now made way for it to sell its surplus wheat stocks.

Several countries queued up for Indian wheat in recent weeks: Turkey recently placed orders for 50,000 tonnes. A month ago, Egypt, the world’s largest importer of Russian and Ukrainian wheat, approved India as a new supplier looking to import a million tonnes.

Amid this spike, production in India has also fallen, primarily due to the severe heat waves in March. On May 4, the Indian government slashed production estimates by 5.7% to 105 million tonnes (MT) from the projected 111.32 MT for the crop year ending June.

These factors have cumulatively caused wheat prices to rise sharply by 15-20% in the