The Union Government’s decision to ban the export of wheat with immediate effect has already had an impact on the soaring wheat prices in Karnataka. Hours after the export ban order, the price of wheat saw a 2% to 3% correction on Saturday, industry insiders said.
“A kilogram of mill quality wheat delivered in Bengaluru was trading at ₹25.20 on Friday and post the export ban, the price was ₹24.40, a drop by 3.17%,” said M. K. Dattaraj, managing director, Krishna Flour Mills, and past president of Roller Flour Millers Federation of India. He said with the export ban, the price of wheat was expected to see a correction further, which will also impact atta, rava, and other wheat-related products.
Exports and the resultant shortages in the domestic market had led to a spike in prices of wheat and related products — on an average around 25% when compared with the prices same time last year — over the last two months.
The Ukraine-Russia war has disrupted global supply chains as both countries were major exporters of wheat and related products to Europe and other western countries. This created a demand for wheat in the global market, triggering exports from India.
“Usually exports from the country were less than 1% of our wheat production. But this year, it has already crossed 15%, creating a shortage in the domestic market. Even the Government of India is unable to find wheat at minimum support price in the market for the public distribution system, triggering an export ban,” explained Ramesh Chandra Lahoti, a senior foodgrain merchant and vice- president, Federation of Karnataka Chambers of Commerce and Industry. The export ban order came days after the Retail Inflation for April was revealed to be 7.79%, a eight year high.
