India will suffer one of its biggest falls in wheat production on record thanks to losses to an “unprecedented spike in temperatures”, which have prompted the government to impose an export ban.
India, the world’s second-largest wheat producing country, after China, will end up with 99m tonnes of the grain from this year’s harvest – 11m tonnes below initial expectations, the US Department of Agriculture’s New Delhi bureau said.
A harvest at that level would represent the lowest in five years and come in 9.7% below 2021’s record crop.
That would be the biggest drop, in tonnage terms, of the past 40 years, and tie with 2015 for the largest plunge in percentage terms.
“Heat stress resulting from an unprecedented spike in temperatures beginning in the mid-March 2022 has had a marked impact on India’s wheat crop,” the bureau said.
“Unprecedented record high temperatures… during the crop’s milking/grain filling stage has affected grain setting, resulting in smaller grain size and higher immature/shrivelled grains.”
The bureau added that “yields are showing a 10-15% decline across the major wheat growing areas, particularly for late-planted wheat”.
The loss of production prompted India’s government earlier this month to impose export curbs – adding to supply worries for a world market already struggling against losses to dryness, as with for instance the North American 2021 crop, and to the war which has shrunk shipments from Ukraine.
Indeed, a market which has been relying on India to fill some of the void, with the country’s shipments topping 8m tonnes in 2021-22, is now trying to assess what the ban will mean for 2022-23 volumes.
The bureau noted that the smallprint of the ban “specifies exemptions… for pending export shipments with an irrevocable letter of credit issued on or before the date of notification”.
Furthermore, “exports are allowed with the Indian government’s permission to other countries to meet their food security needs and based on requests from these governments”.
The bureau said that it had initially expected shipments to reach 10m tonnes, with market estimates ranged between 10m-14m tonnes.
It added that “under the current market supply situation, India’s wheat exports in 2022-23 would barely touch upon 6m tonnes.
“Sources report that 5m-6m tonnes of wheat were under contract for exports in the first four months of 2022-23.”
The International Grains Council last week cut its forecast for India’s 2022-23 wheat exports by 4.6m tonnes to 4.9m tonnes.