India bans wheat exports with immediate effect
India banned wheat exports with immediate effect on Saturday, just days after saying it was targeting record shipments this year, as a scorching heatwave curtailed output and local prices hit an all-time high amid strong export demand.
The government said it would still allow exports for letters of credit that have already been issued and on the request from countries that are trying "to meet their food security needs."
Global buyers were banking on the world's second-biggest wheat producer for supplies after exports from the Black Sea region plunged following Russia's invasion of Ukraine in late February. Prior to the ban, India was targeting to ship out a record 10 million tonnes this year.
"The ban is shocking," a Mumbai-based dealer with a global trading firm said. "We were expecting curbs on exports after 2-3 months, but seems inflation numbers changed government's mind."
Rising food and energy prices pushed India's annual retail inflation up towards an eight-year high in April, strengthening economists' view that the central bank would have to raise interest rates more aggressively to curb prices.
