Centre restricts wheat flour exports to stabilise soaring local prices

India's cabinet approved a policy to restrict wheat flour exports to calm prices in the local market, the government said in a statement

MUMBAI (Reuters) - India's cabinet on Thursday approved a policy to restrict wheat flour exports to calm prices in the local market, the government said in a statement.

New Delhi banned wheat exports in mid-May as a scorching heatwave curtailed output and domestic prices hit a record high. In July India asked traders to secure permission before exporting wheat flour.

The ban on wheat exports boosted demand for Indian wheat flour and the country's flour exports jumped 200% during April-July 2022 from a year ago and lifted prices in the local market, the government said.

"There was a policy not to prohibit or put any restrictions on the export of wheat flour. Therefore, a partial modification of the policy was required....to ensure food security and put a check on mounting prices," it said.

Local wheat prices jumped to a record 24,500 rupees ($306.71) per tonne this week.

That was up nearly 20% from recent lows that followed the government's surprise ban on exports on May 14, ending hopes India could fill the market gap left by a plunge in exports from the Black Sea region following Russia's Feb. 24 invasion of Ukraine.

($1 = 79.8800 Indian rupees)

 

(Reporting by Rajendra Jadhav; Editing by Emelia Sithole-Matarise)