Indian Wheat Prices Rise by ₹150 per Quintal Following Export Ban Lift

Indian wheat prices have increased by over ₹150 a quintal following the government's decision on August 24 to lift a four-year ban on the export of wheat and allied products such as flour, maida, and semolina. The policy change comes at a time when global wheat prices are hovering near a three-year high, sparking debate among industry stakeholders regarding domestic supply and price stability.

According to data from the Price Monitoring Division of the Department of Consumer Affairs, the all-India average retail wheat price stands at ₹31.58 a kg, with a maximum of ₹55 and a minimum of ₹22. While the increase in prices at agricultural produce marketing committee (APMC) yards has not yet fully translated to retail outlets, industry participants expect the impact to reflect soon.

Prices at agricultural terminal markets in Uttar Pradesh have seen notable increases since August 17. In Lucknow, prices moved from ₹2,466 to ₹2,640 a quintal. In Hardoi, a key growing region, the price of the Dara variety rose from ₹2,408.21 a quintal on August 17 to ₹2,553.31 on Tuesday.

The price movement has drawn mixed reactions. Some industry members have expressed concern over the timing of the export decision, citing weather risks associated with El Nino, which global agencies forecast will last until March 2027. Concerns have also been raised over crop conditions, with some millers pointing to a 7-8 percent drop compared to the previous year and rising maize prices.

Conversely, other trade participants argue that domestic supply buffers remain strong and that high export prices will limit outbound shipments. According to the Ministry of Agriculture and Farmers’ Welfare, wheat production for the year is estimated at a record 120.66 million tonnes, compared to 117.95 million tonnes the previous year. Furthermore, Food Corporation of India data shows that wheat stocks as of August 1 reached a five-year high of 50.53 million tonnes.

Exporters note that Indian wheat currently lacks global price competitiveness. Rajesh Jain Paharia, a New Delhi-based exporter, stated that Indian wheat is at least $30 a tonne higher than wheat from other origins. Free-on-board (f.o.b) prices at Kandla are quoted at $325 a tonne, compared to $295 or lower from alternative supplier countries. Consequently, analysts expect shipments to be restricted primarily to neighboring regions such as Nepal, Bhutan, and parts of northern Bangladesh.

Global market conditions continue to influence pricing trends. Wheat prices on the Chicago Board of Trade reached $7.54 a bushel, supported by disruptions in the Black Sea region affecting Russian exports and weather-related lower production forecasts. Additionally, International Grains Council projections estimate global wheat production for 2026-27 at 817 million tonnes against consumption of 826 million tonnes, with carryover stocks expected to decline to 275 million tonnes.

"The lifting of the wheat export ban presents a complex scenario for the domestic market. While buffer stocks are at a healthy five-year high, global price dynamics and weather uncertainties like El Nino require businesses to monitor supply chains closely. Although Indian wheat currently faces pricing disadvantages internationally, agricultural enterprises and processors must balance export opportunities with domestic price stability to mitigate inflationary pressures in retail markets." — Dr. Shishir Gupta, Founder & CEO, StartupLanes