The Hindu Business Line : Row over Pakistan wheat exports resolved

"There was a problem with the limit set for purchase of wheat from private trade in Pakistan. It has been set right and we don't see any problems with regard to imports by roller flour mills here," an importer getting wheat from Pakistan to India said.

Wheat exports from the Karachi port came to a halt on Saturday after the Customs authorities there denied permission for shipments saying the quota allocated for private trade wheat had been exhausted.

According to media reports in Pakistan, Islamabad had initially decided to allow export of five lakh tonnes wheat. Later, it was increased to eight lakh tonnes. Of this, 50,000 tonnes were allowed to be bought from the private sector. Stocks with the Pakistan Government were meant to make up the rest of the quantity.

However, nearly 1.5 lakh tonnes of wheat have been bought from the private sector, forcing the authorities to act. As a result, nearly 500 containers of wheat were held up. On Monday, the Pakistan Government decided to allow the shipments on the condition that there would be no more procurement from the private trade.

Initially, Indian buyers were in the dark about the consignments they had contracted for imports. But importers said shipments would come as scheduled as the problem had been resolved.

"Our sellers have gone to Islamabad to sort out the issue. We think they will get the stocks from the Government and therefore, we see no problem in getting the consignments," the importer said.

The problem in Pakistan was sorted out after the trade pointed out that the Customs authorities had failed to notify the quantum of the wheat that had been bought from the private trade and shipped out.

Meanwhile, 250 containers (22 tonnes each) of wheat from Pakistan arrived in Tuticorin last week, while another 50 containers have landed in Mumbai. "Another 200 tonnes are arriving in Tuticorin in two days time," trade sources said.

Roller flour mills in South India are importing wheat from Pakistan as they find it cheaper than buying it from the domestic market. While mill sources put the contracted quantity at around 2,000 containers, trade sources said nearly 8,000 containers (totalling about 15,000 tonnes) will be imported from the neighbouring country.

The import price of Pakistani wheat is $225-232 (Rs 9,400-Rs 9,690) a tonne c&f. The landed price of Pakistan wheat for the southern mills near the ports will be around Rs 10,700 a tonne. For mills away from the ports, the cost could be Rs 11,200. On the other hand, given the minimum support price of Rs 850 a quintal for domestic wheat, it would cost the mills Rs 11,500 to buy domestic wheat.

Pakistan's wheat production is estimated to be 23 million tonnes, leaving scope for exports due to a surplus of four million tonnes. It has also carryover stocks of two million tonnes wheat from last year. Pakistan in December last decided to allow wheat exports, banned since 2003 after fall in production.

India is expected to import at least three million tonnes of wheat this year despite production being estimated at 73.7 million tonnes against 69.35 million tonnes last year.

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