As concerns of heatwave ebbed across key wheat-growing states in India, wheat harvest in the country is now facing worries from showers and hailstorms. Traders are concerned that the showers and hailstorms may lead to yield and quality loss in the crop.
It would also mean there would be no imminent changes to India's wheat export ban until clear picture emerges on harvest and domestic inventory situation.
According to the Indian Meteorological Department, key wheat-growing states -- Rajasthan, Madhya Pradesh, Punjab and Bihar -- have witnessed excess showers and hailstorms.
Storms, rainfall, or hail could batter almost the entire country for another two days, an update by the weather bureau said on March 19.
"At this stage, heavy rain and strong storms will hit fully ripened wheat, inundate fields, however, the extent of damage is not certain," a scientist with the Agricultural Meteorology Division of IMD said.
For marketing year 2022-23 (April-March), India's wheat output is seen at a record 112.2 million mt, up 4.2% on the year, according to data released by the agriculture ministry Feb. 14.
Wheat is planted during October-November and harvested over March-April.
Market participants are, however, skeptical of India's wheat harvest estimate. According to an S&P Global Commodity Insights survey of 11 analysts and traders, India's wheat harvest is expected at 107 million-108 million mt in MY 2022-23. Some trade sources in Asia even see the production lower between 92 million-95 million mt, echoing the total production in MY 2021-22.
"The crop has been damaged in some areas in Punjab, Uttar Pradesh and Madhya Pradesh which may lead to a drop in yield and quality," a trader based in Indore said.
While harvesting is now set to be delayed, the yield losses can be balanced out as in parts of Punjab, Haryana and Uttar Pradesh the wheat crops are not yet fully mature, the scientist added. In these states, wheat is harvested in April.
"Most of my crop has fallen due to the gusty winds which will lead to yield loss and quality downgrade," a farmer based in Kanpur, Uttar Pradesh, said.
In place, where harvesting had started and the crop was left in the open, the damage will be significant. Some pockets in Rajasthan and Madhya Pradesh start wheat harvest in early March.
Trade scenario
India is unlikely to resume wheat exports during the next few months until the harvest is completed and the government replenishes its inventory, an official with the food ministry said.
Due to a decline in output in MY 2021-22, India imposed a ban on wheat exports on May 13, 2022, to check rising wheat prices and ensure adequate supply. The country had emerged as a key supplier of wheat amid global shortages in the wake of Russia's invasion of Ukraine.
The government has also released 5 million stocks from its inventories over January-February, forcing domestic wheat prices to ease.
As of March 1, the government has 11.7 million mt wheat in its stocks, nearly halving on the year.
Wheat prices have declined to around Rupees 22,000/mt ($284.5/mt) March 17, down from record highs of Rupees 31,500/mt seen in January, traders said.
"The government may look to relax exports restrictions imposed last year but only after it ensures enough stocks required to run government schemes and ensure adequate domestic supply," an exporter based in Mumbai said.
Source - https://www.spglobal.com
