India, the world's biggest wheat consumer and grower after China, banned exports in 2022 and is relying on bumper harvests to bolster stocks and tame local prices that surged after dry weather shrivelled the crop in 2022 and 2023.
"After assessing the crop across the country, we believe that wheat production will be 105 million metric tons this year," said Navneet Chitlangia, senior vice president of the Roller Flour Millers Federation of India.
According to a government estimate, India is likely to produce 112 million metric tons of wheat in 2024.
In 2023, India produced a record 112.74 million metric tons of wheat, according to the farm ministry, but trade and industry officials said last year's wheat production was at least 10% less than the government's estimate.
Lower wheat output forced the government to sell a record 10 million metric tons of wheat from its reserves to bulk buyers such as flour millers and biscuit makers, leading to a drawdown in reserves essential for the world's biggest food welfare programme.
Wheat inventories in government warehouses fell to 9.7 million metric tons at the start of March, the lowest since 2017.
The government is confident of replenishing its depleting reserves.
The state-run Food Corporation of India (FCI) is expected to buy 31 million-32 million metric tons of wheat from domestic farmers this year against 26.2 million metric tons in 2023, said Ashok K K Meena, chairman and managing director of the FCI.
The FCI has already started buying new-season wheat, Meena said, purchasing a million metric tons from domestic farmers since the start of the current harvest season in early April, against 700,000 metric tons in the same period a year before.
India has asked global and domestic trade houses to avoid buying new-season wheat from local farmers to help the FCI procure large quantities to shore up its depleting reserves.
(Reporting by Mayank Bhardwaj; Editing by Jan Harvey)
By Mayank Bhardwaj
