India's exports of wheat, rice and corn are expected to drop sharply by 29% to 13.5 million tonne in the 2014-15 marketing year due to sluggish global prices, according to a US agriculture department (USDA) report.
The combined shipments of wheat, rice and corn from India are estimated to touch 19 million tonne in the 2013-14 marketing year, it said.
The marketing year for wheat runs from April to March; for rice, from October to September and for corn, from November to October.
"Exports of wheat, rice and corn during the 2014-15 marketing year are forecast down from the year prior, due to softening global prices," the USDA said in its latest report. Out of 13.5 million tonne of cereals, India is expected to ship 8 million tonne of rice, 3 million tonne of wheat and 2.5 million tonne of corn in 2014-15, it said.
According to USDA, wheat exports are forecast to halve to 3 million tonne in 2014-15, most of which will be private exports and some spillover of government wheat from the existing current 2 million tonne quota announced in August 2013. "With international prices expected to remain depressed during the upcoming marketing year, it will be very difficult for the government to export wheat at $260 per tonne floor price," the report said.
On rice exports, the USDA said it has forecast it to be lower at 8 million tonne (Basmati and non-Basmati) for 2014-15 marketing year, as against 10 million tonne this year, on expected weak international prices and expected lower import demand from Iran.
Trade sources report that exports of Basmati rice to Iran have slowed since October 2013 following the withdrawal of Iran sanctions by the US and five other nations, it added. On corn exports, the USDA said the shipments may drop further to 2.5 million tonne in 2014-15 from 3 million tonne this year, on expected strong domestic demand. "Market sources report that Indian corn is barely competitive in the global market due to weak international prices," it said.
Typically Indian corn is discounted for quality vis-a-vis other origins and export volumes largely depend on the price competitiveness of Indian corn in the global market, it said. Any significant improvement in international corn prices or weakening of the value of the rupee may improve the export prospects, it added.
USDA expects India's rice production to be 103 million tonne and wheat output at 92.46 million tonne in 2013-14.