India allows export of 2.5m tonnes of wheat

Business Desk :

India’s federal government allowed the export of 2.5 million metric tonnes of wheat and an additional 500,000 tonnes of sugar, it said on Friday, as the world’s second-biggest producer of both commodities seeks to support local farmers.

In a statement it said the aim was to stabilise domestic markets and ensure financial returns for farmers, following a review of current supply and price trends.

Last month, the federal government allowed exports of 500,000 tonnes of wheat flour and other wheat products, after approving exports of 1.5 million tonnes of sugar in November for the season that began on October 1.

Traders said the permission to export was likely to improve sentiment in the local market, but fulfilling the allocated volumes may be difficult.

Sumit Gupta, CEO of Waseda Global, a Gurugram-based commodity brokerage, said Indian prices’ hefty premium over other origins would be a challenge.

Indian wheat is offered at around $280 per tonne free-on-board basis, compared with about $200 per tonne for Argentine supplies.

Bangladesh, a neighbouring buyer, is securing better-quality wheat at around $260 per tonne, cost and freight basis, he said.

India banned wheat exports in 2022 and extended the prohibition after extreme heat shrivelled crops again in 2023 and 2024, draining reserves, pushing domestic prices to record highs and fuelling speculation that it might need to import wheat for the first time since 2017.

However, conditions improved last year, with better weather, higher-yielding climate-resilient seeds and adequate soil moisture from two consecutive monsoons, raising the chance of another strong harvest this year.

In 2025, India produced a record 117.9 million metric tons of wheat.