Global wheat prices may soar as India bans exports

STORY: India banned wheat exports on Saturday, as a scorching heat wave slashed output and domestic prices hit a record high.

Commerce secretary B.V.R. Subrahmanyam told reporters the country would still allow some exports to fulfill existing contracts and support countries with food security needs.

“In the name of prohibition, we are directing trade in a certain direction. We do not want wheat to go in an unregulated manner to places where it might just get either hoarded or where it may not be used to the purpose which we are hoping it would be used for, which is, serving the food requirements of vulnerable nations and vulnerable people."

Officials told the news conference in New Delhi the plan is not to ban the grain’s export forever, and that the rule could be revised later on.

The move comes just days after India said it was targeting record wheat shipments of 10 million tonnes this year.

The world's second-biggest wheat producer has been cashing in on a global rally in the grain’s prices since Russia’s invasion of Ukraine.

It exported a record 7 million tonnes of wheat in the fiscal year to March – up more than 250% from the previous year.

Although India is not one of the world's top wheat exporters, global buyers have been relying on supplies from the country after shipments from Ukraine and its surrounding Black Sea region plunged.

Analysts say the ban could now drive world food prices to new peaks given the already-tight supply, which would hit poor consumers in Asia and Africa especially hard.