Wheat Imports To Be Costlier Due To Higher Freight Costs

Mumbai: Owing to higher freight costs and an increase in global prices of the commodity, India may have to pay as a minimum of a third more than it did last year to buy the grain. The government may receive offers between $264 a tonne and $281 a tonne to import 1 million tonnes of wheat in a tender that closed on May 21, according to a median forecast of eight traders and analysts. That compares with an average $205.31 a tonne buyers paid last year. The country is buying wheat for a second year to boost reserves as demand exceeds production. The purchases come at a time when freight rates have climbed to more than a two-year high as China and India, the world's two most-populous nations, buy more grain and iron ore. Wheat prices have advanced 16 per cent in the past year as bad weather damaged crops from the US to Australia. The Baltic Dry Index, an overall measure of commodity-shipping costs, has risen 48 per cent this year. The country's wheat imports might total 5 million tonnes this year.