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Government to limit wheat importsnews
30 September 2006

Mumbai: The government expects to stop importing wheat once the stockpile reaches comfortable levels, agriculture minister Sharad Pawar said. ``Our stock position will be comfortable,'' newspaper reports quoted Pawar as saying.

India, the world's second-biggest wheat producer, began importing the commodity in February after a six-year gap to boost its buffer stock. Government agencies have so far contracted to buy 5.5-million tonnes of wheat.

India's purchases have boosted world wheat prices by almost 35 per cent and a halt in imports by the second-biggest wheat consumer is expected to cap this gain.

Wheat December contract is ruling around $4.49 a bushel on the Chicago Board of Trade (CBOT), the highest since April 22, 1997. Prices have rallied as drought cut crops in the US, India and parts of Europe and former Soviet Union.

India has pegged warehouse buffer stocks of wheat at four million tonnes as of April 1, enough to meet its emergency needs for public distribution and other contingencies.

Wheat output in the country fell to 69.4-million tonnes in the current harvest season ended June against an estimated production of 73 million tonnes. The government started wheat imports through its agencies and also allowed private traders to buy wheat duty-free until December 31 to plug the production gap.

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Government to limit wheat imports