The first firm to buy is expected to be MMTC Ltd, followed by PEC Ltd and State Trading Corp. The source did not say when the tenders would be issued. The total quantity to be imported is likely to be split equally between the three firms. Shipments are expected to be firmed up between December and March 2008.
India, the worlds second-biggest wheat producer, has tied up import contracts for 1.3 million tonnes of the grain this year, after buying 5.5 million tonnes in 2006 as prices flared due to a poor crop. Those were the first overseas buys in six years.
The prices of the imported wheat are definitely going to be $400 to $450 per tonne, said a senior Mumbai-based official at an international commodities firm.
The last imports contracted in September were at a weighted average price of $389.45 per tonne.
Earlier this month, the government raised the price it would pay local wheat farmers next year to Rs 1,000 ($25.4) per 100 kg from Rs 850 to encourage planting. Traders said sowing prospects for the domestic crop to be harvested next March or April appeared to be good because of the decision to raise prices and good soil moisture. Indias wheat output is expected to be around 74.9 million tonnes in 2007 up from 69.3 million tonnes last year.
To feed the countrys more than one billion people, it needs about 73 million tonnes.