The Centre has made it mandatory for all exporters to seek prior permission from the inter-ministerial committee on wheat export before undertaking any outbound shipment
As per a notification from the Directorate General of Foreign Trade (DGFT) issued on July 6, the arrangement will come into force from July 12.
The government has restricted the export of wheat flour and other related products, such as maida, rava (samolina), wholemeal atta and resultant atta. All exporters will need to seek prior permission from an inter-ministerial committee on export of wheat before undertaking any outbound shipment. The Centre had banned the export of wheat in May.
According to a Directorate General of Foreign Trade notification issued on July 6, the curbs will come into force from July 12.
Until July 12, those shipments will be allowed where loading on the ship had started before July 6 or the consignments were handed over to the customs department before the notification was issued.
However, unlike wheat, there has been no outright ban on the export of wheat flour and related products.
The curbs have been imposed despite some stabilisation in wheat flour prices since May 13, when wheat export was banned.
Some trade sources said exports were being curbed to ensure that fly-by-night operators and those in the market to make fast money did not export unusually high volume of wheat flour to bypass the ban on wheat export.
“Wheat flour export will now be under control. Earlier the flour export was at a peak.
However, atta (wheat flour) prices have already softened, even before the ban, and now they might go down further. But it will be for a short time because the coming festival season and stopping of open market sale of wheat by the central government will keep prices supported. The fundamentals of demand and supply still support wheat and atta prices,” Rahul Chauhan, commodity analyst at iGrain India told Business Standard.
According to the food ministry, India exported 95,167 tonnes of wheat flour (atta) in April 2022, which stood at around 26,000 tonnes in April 2021, a jump of almost 267 per cent.
Meanwhile, exporters of wheat products in small consumer packs of 5 and 10 kilograms have approached the commerce ministry to allow them to export freely without any curbs.
“Since, this segment of exporters have built this business in a close network with overseas buyers, if there is any restriction in export of such commodities it will be a big disaster,” the small exporters said. They said around 75000 tonnes of wheat flour and related products are annually exported in small pack sizes.
Overall, In FY22, India exported a record of over 7 million tonnes of wheat, worth around $2.12 billion, which in value terms was 274 per cent more than the same period last year.
But in FY23, around 4.5 million tonnes of wheat had been contracted for exports till the time of ban, according to official records.
Of this, 1.47 million tonnes was shipped in April 2022, while in April 2021, around 0.24 million tonnes was shipped. If the exports weren’t banned, India could have exported around 8-10 million tonnes of wheat, according to experts.