The Indian government has banned the export of wheat to various countries. This is, because of the heat wave that hit the country of India, thus making production limited.
The government said it would still allow exports to countries that had entered into a grain sale and purchase agreement before the policy was issued.
"This is to meet their food security needs," said the Government of India as quoted by CNN Business, Monday (16/5/2022).
According to a senior government official, this ban is only temporary, and the government will look at domestic conditions to lift the rule.
Officials added that there had been no decline in wheat production this year, but that unregulated exports had led to a rise in local prices.
"We don't want the grain trade to take place in an unregulated way or to hoard," BVR trade secretary Subrahmanyam told reporters in New Delhi.
This prohibition surprised global countries, because they relied on wheat from India as a result of the ban on exports of countries in the Black Sea region, due to the Russo-Ukrainian war.
While not one of the world's top wheat exporters, India's ban could push global prices back high.
"The ban came as a surprise. We were expecting export curbs after two to three months, but it looks like the inflation figures are changing the government's mind," said a Mumbai-based trader.
Rising food and energy prices pushed India's annual retail inflation to near an eight-year high in April, reinforcing expectations that the central bank will raise interest rates more aggressively.
prices Wheat in India have climbed to record highs, reaching 25,000 rupees (USD 320) per tonne in some spot markets, well above the government's benchmark minimum price of 20,150 rupees.
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