India has come to the fore this year to feed the world, but can they?
The reduction in export volumes from the black sea in conjunction with strong supplies from India has caused a change in trade flows. India is in the front seat to supply large volumes.
Last year we wrote about this in India to test Australia on wheat?. Interestingly India is quite seasonal, with some years as an exporter and some as an importer dependent upon their conditions (here).
Egypt is the world’s largest wheat importer, and due to quality concerns, they don’t accept Indian wheat. That is until this year.
There are projections of between 12 and 16mmt of wheat exports this year. The chart below shows the annual export volume of Indian wheat since 2000. The largest year was last year; the projections for this year are almost double.
According to Comtrade data, the highest monthly exports from India were 975kmt in January of this year. To meet the forecasted volumes, India will have to achieve consecutive months at record export volumes.
It isn’t impossible for India to do this. There are new ports in operation with a possible additional volume of 3 to 4mmt. The reality is that inland logistics may be the largest barrier, as we know from our own experience that the lowest hanging fruit goes first, then supply chains get longer (and slower).
They will have a large export program this year, but the question will be whether it can achieve the high-end projections. The high prices for wheat are an incentive to get grain onto the export market, much like it is here.