India announced on Saturday to ban wheat exports in the face of a drop in its production, due in particular to extreme heat waves, a decision which will “aggravate the crisis” of grain supply with the war in Ukraine, if alarm the G7.
Second wheat producer in the world, India has decided to ban exports of this commodity, except with special authorization from the government, in order to ensure the “food security” of its 1.4 billion inhabitants.
Export contracts concluded before the decree may be honoured, the measure only concerning future exports. For the latter, India will approve requests from other countries on a case-by-case basis “to meet their needs”.
Gathered in Stuttgart, Germany, the G7 Agriculture Ministers immediately criticized this decision, which comes as the world wheat market is already under great tension due to the Ukrainian conflict.
“If everyone starts imposing such export restrictions or even shutting down markets, it will only worsen the crisis and it will also hurt India and its farmers,” said the German Minister of Agriculture. Agriculture, Cem Özdemir, following a meeting with his counterparts.
“We have spoken out against export restrictions and call for keeping markets open […]. We call on India to assume its responsibilities as a member of the G20,” he added.
Launched on February 24, the Russian military offensive in Ukraine is seriously disrupting agricultural activity in the countryside of this country, which until then was the world’s fourth largest corn exporter and is on the way to becoming the third wheat exporter.
Due to the blockade imposed on Ukrainian ports, around 20 tonnes of grain are waiting in silos to be exported and this year’s harvest is threatened.
Rising prices and shortages thus pose a risk of famine and social unrest, particularly in the poorest countries which massively import their grain needs.
Protectionist measures
This context also raises fears of protectionist measures on the part of exporting countries: at the end of April, Indonesia, the world’s largest producer of palm oil, banned palm oil exports in order to contain the surge in prices on the domestic market and shortages.
Until Saturday, India had for its part expressed its readiness to come to the aid of world markets in the event of supply problems.
“Our farmers have made sure to take care of not only India but the whole world,” Trade and Industry Minister Piyush Goyal said last month.
The country had indicated that it wanted to increase its annual wheat exports, from April 1, from 7 to 10 million tonnes, bringing some air to the sector.
On Thursday, New Delhi had also announced that delegations were going to several North African countries, Turkey, Vietnam, Thailand and even Lebanon to “study ways to strengthen wheat exports from India”. “. It was unclear on Saturday whether those trips were maintained.
The announcement from New Delhi comes as India has been facing extreme heat waves for two months: the country experienced the hottest March in its history, and the heat wave has continued in recent weeks with temperatures sometimes above 45 degrees.
According to climate change experts, India is expected to be hit more and more frequently by such heat waves.
Earlier this month, the government had indicated that these climatic conditions would lead, for the first time in six years, to a drop in the wheat harvest, of at least 5% compared to 2021. Some 110 million tonnes had been harvested last year.
On Saturday, the agriculture ministers meeting in Stuttgart “recommended” to discuss the Indian decision at the meeting of G7 heads of state and government in June, where India will be present as a guest. .