India restricts wheat flour exports to ease record local prices

India’s cabinet has approved restrictions on wheat flour exports to calm prices in the local market.

The government banned the export of wheat itself in mid-May as a heatwave curtailed output and domestic prices hit a record high. That ban boosted demand for Indian wheat flour, exports of which jumped 200% between April and July from a year ago, and lifted prices in the local market, the government said on Thursday.

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

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

Before the ban, India had aimed to ship a record 10m tonnes this year. Much of that would have gone to other developing countries such as Indonesia, the Philippines and Thailand.

Apart from problems with the heatwave damaging harvests, India’s vast stocks of wheat – a buffer against famine – have been strained by the distribution of free grain during the Covid-19 pandemic to about 800 million people.

Tags: India, flour, restrictions