1. On May 14 2022, the Indian government announced an immediate ban on wheat exports, having earlier downplayed reports that it was considering restricting trade in an attempt to protect domestic consumers from rising food prices, against a backdrop of lower-than-expected wheat production and wider concerns about food security. 2. At Fitch Solutions, we are holding to our forecast that Indian wheat production will fall by 1.0 y-o-y to 108.4mn tonnes in 2022/ 23, driven by the yield-reducing effect of extreme heat conditions experienced in major crop-growing regions in March and April, and stress that short-term risks are strongly weighted to the downside. 3. With regard to demand, we expect that Indian wheat consumption will increase by 5.0 y-o-y to 108.6mn tonnes in 2022/23, after exceeding our forecast for 2021/22 by 3.0mn tonnes on the back of high Covid-related procurement by government agencies. 4. Wheat procurement by the Indian government is set to fall in 2022/23, which will apply downward pressure to stocks and may necessitate compensatory import purchases, as occurred in 2006/07, or the use of accumulated rice reserves as a means to meet its commitments to subsidised food programmes.
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