India wheat futures may edge higher on export talks

Jun 26 2009 9:20AM

MUMBAI, June 26 (Reuters) - Indian wheat futures may edge higher on Friday on expectations of exports of wheat products, but soaring stocks may limit gains, analysts said.

Analysts said a below-average monsoon forecast may also support the commodity prices as it may reduce output of summer-sown food grains, increasing reliance on the winter-sown wheat.

Earth Sciences Minister Prithviraj Chavan told a news conference on Wednesday that the 2009 monsoon rainfall would be 93 percent of the long-term average, lower than an earlier forecast of 96 percent.

July futures contract on National Commodity and Derivatives Exchange last ended at 1.094.2 rupees, up 0.11 percent.

India has so far purchased 24.75 million tonnes of wheat in 2008/09 marketing year beginning April 1, sharply up from 22.26 million tonnes bought the year ago, a Food Corp of India (FCI) official said on Thursday.

India is expected to buy a record 25 million tonnes of wheat from farmers in the current season, up 11 percent from a year earlier, government officials said on June 10.

Soaring stocks may pave the way for export of the grain, analysts said.

According to local newspaper reports, the food ministry has approved a proposal for export of 0.65 million tonnes of wheat products.

India will look at lifting grain export curbs only after watching the progress of monsoon rains and the planting of summer-sown crops, its farm secretary said on Thursday.