India lifted the ban on wheat exports. The Directorate General of Foreign Trade has transferred the export regime of wheat and its processed products from the "prohibited" category to the "free" category, the change takes effect immediately.
The ban has been in effect since May 2022. It was introduced as an emergency measure against the background of a sharp rise in world prices and concerns about domestic food supplies, and then extended several times. Over the years, the country, which is one of the largest wheat producers, has actually dropped out of world trade in this commodity.
Changing the status to "free" in Indian practice means that exports no longer require a special permit. This does not always mean that there are no conditions at all: in parallel with the general regime, the authorities often maintain minimum export prices, restrictions on individual processed products, or requirements for registration of contracts. You need to check these details by the text of the notification itself, not by the headline of the news.
A channel that has been closed for four years is being opened for traders working in the Indian sector. The nearest buyers are the markets of South and Southeast Asia, as well as the Middle East, where the logistical leverage from India is noticeably shorter than the alternatives.
For Russian grain exporters, the news means the emergence of a competitor in the same markets. Indian wheat does not occupy exactly the same niche in terms of quality characteristics, but there will be an intersection in price-sensitive areas. It makes sense to assess the effect not by the lifting of the ban, but by the rate of output of real volumes: part of the harvest is contracted within the country, and you should not expect an instant wave of supply.
What to do in the coming weeks. Traders in the Indian direction should request the details of the DGFT notification and check the availability of the minimum export price and procedural conditions. Russian exporters should include the scenario with the Indian offer in the price models for Asian contracts for the fourth quarter.
