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M.R. Subramani

CHENNAI, Feb. 16

FOODGRAIN exports have almost ground to a halt on shifting Government policies, rise in stocks sold by the Food Corporation of India (FCI) and non-availability of railway wagons.

According to exporters, neither are global buyers ready to rely on Indian grains nor are sellers willing to transact in view of changing prices. This has resulted in the country losing opportunity to export at least 10 lakh tonnes of wheat and 2-4 lakh tonnes of rice. Besides, exporters are also reported to have incurred losses to the tune of Rs 10-15 crore on account of changing prices and demurrages due to delay in transportation.

``Until December last year, we were thriving on export of lustre-lost wheat. But FCI has stopped its supply since December 18. We were getting at least milling wheat. However, since last week that too has been stopped for verification and price fixation by FCI,'' Mr Rajnikanth Rai, Vice-President - Exports, ITC International Business Division, told Business Line.

In January, FCI raised the issue price for milling wheat to Rs 4,810 a tonne for old stocks and Rs 4,950 for new stocks from Rs 4,560 and Rs 4,600 respectively.

``The Government policy seems to be changing on hourly basis that our entire exports are under trouble,'' Mr Atul Chaturvedi of Adani Exports.

One of the problems currently faced by exporters is that the buyers are unwilling to sign contract on the condition that the rates would be subject to FCI price. ``Buyers are just not interested in such contracts. They want to trade on international laws,'' Mr Rai said.

Last week, an international trader sent a mail to his clients stating that lustre-lost wheat was unavailable while milling wheat would be provided at $120 f.o.b Kandla. The current offer is against a price of $108 f.o.b in January.

With Indian wheat turning costly and unavailable, buyers are now turning to wheat of other origins. Kazakhstan and Ukraine have begun to benefit indirectly. Countries such as Indonesia and Malaysia, which buy wheat for flour, have begun testing wheat from Kazakh and Ukraine.

Around 4.5 lakh tonnes of wheat have been exported during the current fiscal. ``Maybe, the Government is of the view that pace of exports has to slow because of lower crop and drought,'' sources said.

On the rice front, entry of Burma and stiff competition from Vietnam and Pakistan are taking their toll on exports.

``Nobody seems to want to buy Indian rice. In fact, they are now assured of better quality graded rice from Vietnam for a lesser price,'' ITC-IBD's Mr Rai said.

Currently, Indian raw rice 25 per cent broken is ruling at $145-147 a tonne for old crop and $152-155 a tonne for new crop. As against this, Burmese rice is quoted at $138-140, Vietnam rice at $151 and Pakistan rice lesser than $150.

While rice exports have been stuck due to price revision from February, during December and January it was affected due to lack of rakes.

Against a demand of six rakes in a week, the Railways are hardly allocating two, industry sources say.

``Rice exporters are hardly getting a margin of $1-2 a tonne. But due to the price revision, they have to foot an extra Rs 350 per tonne for old crop and Rs 650 per tonne for new crop. We are losing money,'' Mr Rai said.

The uncertainly over rice exports has resulted in Pakistan winning contracts that normally would have gone to India, according to sources.

Still, the FAO projects Indian to continue in the second position in rice exports this year. After having pipped Vietnam from the second spot, India's rice exports in 2002 were a record 65 lakh tonnes. This year, it is estimated to be 45 lakh tonnes. In contract, Vietnam, whose exports dipped to 32 lakh tonnes last year, is seen improving it to 39 lakh tonnes.

``Going by the current trend, we doubt if we can maintain a good trend and hold on to the second spot,'' trade souces said.

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