India has asked global trading firms, which this week offered to supply wheat against a one million tonne import tender, to lower their bid prices, a senior government official said on Friday.
So far none of the companies have complied with the request, the official, who could not be named, told Reuters. Firms, including Toepfer International, Cargill Inc, Concordia Agritech and Glencore AG, offered a total of 920,000 tonnes of wheat at between $320-$360 a tonne earlier this week. But traders immediately said the government was unlikely to buy large quantities at such prices.
India paid an average $230 per tonne for imports in 2006, when it was forced to tap global markets for 5.5 million tonnes. In May it scrapped a tender for one million tonnes as the average price of $263 per tonne was perceived to be high.
But in June, wheat on the Chicago Board of Trade rose to 11-year highs and traders expect little respite with world wheat stocks seen falling to a 30-year low due to erratic weather in the US and drought in Russia and Ukraine. "The State Trading Corp has forwarded its recommendation to the government on bids against wheat imports. The food ministry will now take a call," the official said.
India, which consumes around 72 million tonnes of wheat annually, is likely to produce more than 73 million tonnes in 2007, up from 69.48 million tonnes last year.
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