Wheat import may be put off on high prices

The government may defer its wheat import plan for some time in the wake of high global wheat prices, a senior government official said late Friday.

The government was earlier planning to float a wheat import tender early August.

"We may defer the import plan for some time as the world grain markets are at record highs and domestic supplies at the moment are comfortable," the official said.

He, however, was non-committal on when the import tender would be floated.

"We are yet to take a decision," he said.

Thursday, the front-month wheat had hit fresh 11-month highs on the Chicago Board of Trade on reports of lower global output.

Global wheat prices are likely to remain firm in the coming days as the US Department of Agriculture has lowered its world output forecast due to bad weather in wheat-growing areas.

In its latest wheat production estimates, USDA has pegged output for the marketing year that commenced Jun 1 at 610.4 mln tn, down from its previous estimate of 612.3 million tonnes. Lower production estimates are expected to keep wheat markets bullish, which may hit India's wheat imports.

In July, the government had placed orders to buy 511,000 tn wheat at an average price of $325 a tonne. It was India's second attempt this year to source wheat from overseas.

In May, government had scrapped its 1-million-tonne wheat import tender citing high prices.

The tender had attracted bids in the $267-302-a-tonne range, but later a couple of bidders had agreed to supply about 300,000 tonnes wheat at $263 a tonne.

At that time, the government had ignored the offer, hoping to get a better deal later in the year.