FCI expects to earn Rs 3,400 cr from wheat exports

NEW DELHI: State-owned Food Corporation of India ( FCI) is expecting to earn more than Rs 3,400 crore from wheat exports in the current fiscal.

In August, the CCEA had allowed 20 lakh tonne (LT) of wheat exports from FCI's godowns in 2013-14 fiscal through public sector trading firms such as STC, PEC and MMTC.

The tenders for export of 9.9 LT of wheat have already been floated by the three trading firms, of which tenders for about 4 LT have already been awarded.

"Looking at the international market scenario and bids received so far, we are planning to export the whole 20 LT wheat by March next year, expecting to earn more than Rs 3,400 crore," a senior FCI official told PTI.

He added that all the bids received so far were above USD 280 per tonne, with highest bid of USD 289.90 per tonne as against the floor price of USD 260 per tonne.

"Corporation hopes that the average price for export of wheat this year would be around USD 281 per tonne," he said.

The government had lowered the floor price for export of wheat this fiscal to USD 260 per tonne from USD 300 per tonne in 2012-13, and allowed to sell wheat in tranches till June next year.

Floor prices were reduced after other major exporters of wheat like the United States, Canada and Australia were selling the same quality of wheat in the range of USD 270-275 per tonne, the official said.

The government had allowed export of 4.5 million tonne wheat from FCI godowns during last fiscal through PSUs. Of that, PSUs sold about 4.2 million tonne at an average price of USD 311.38 per tonne, for over Rs 7,000 crore.

The FCI official added that international market is likely to be flooded with wheat from the US and Canada, "so we are planning to export the whole permitted quantity by the end of this fiscal only".

The government had decided to export wheat as the corporation had surplus stocks against the actual requirement.

Recently, a Parliamentary committee suggested that there is an urgent need to reduce the food subsidy burden and recommended that the government should fix upper limit for foodgrain storage.

FCI is the government's nodal agency for procurement and distribution of foodgrains.