An analysis of Export and Import of Wheat around the world and in India and a description of how the trade actually takes place.

1. EXIM Trade
Abhijit Gaurav | Animesh Swain | Divyansh Vashishth | Jyotin Bhatt | Saurabh Tomar |Vivek Gupta
Commodity: Wheat
GRUBSTAKERS
Analysis By:

2. India’s
Export
Major
Exchanges
Trading
Markets
Analysis of
Global Trade
India’s
Import
Analysis of
Arrivals
Global
Imports
S
Country : Canada
Share in world Export :16 %
Quantity Produced:27,600,000 metric tons.
Shipments Value: $ 6.2 Billion
Shipment Quantity: 24.8 Million Tonnes
Wheat is the staple crop in Canada. To help homesteaders
attain an abundance harvest in a foreshortened growing
season, varieties of Wheat were developed at the beginning
of the twentieth century. And since then wheat
Is one of the majorly produced crop.
Country: United States
Share in World Export: 14.5 %
Quantity Produced: 55,840,000 metric
tons
Shipments Value: $ 5.6 Billion
Shipment Quantity: 21.1 Million
Tonnes
Wheat is produced in almost every
state in the United States, and is the
principal Wheat is produced in almost
every state in the US.
Consequently the surplus results in
heavy exports.
Country: Australia
Share in World Export: 11.4 %
Quantity Produced: 26,000,000
metric tons
Shipments Value: $ 4.4 Billion
Shipment Quantity:16.9 million tons
Wheat is the major winter crop
grown in Australia with sowing
starting in autumn and harvesting,
depending on seasonal conditions,
occurring in spring and summer. This
throughout the year harvesting
leaves a surplus to be exported
1
2
3
4
5
Country: France
Share in World Exports: 11.1 %
Quantity Produced: NA ( Available for EU as a whole)
Shipments Value: $ 4.3 Billion
Shipment Quantity: 18.35 Million Tonnes
France has the most productivity of wheat per hectare at 7.45 metric
Tonnes per hectare. As a result despite of its less geographical area,
It features among the major wheat producers.
Country: Russia
Share in World Exports: 10.1 %
Quantity Produced: 60,500,000
Shipments Value: $ 3.9 Billion
Shipments Quantity: 22.8 Million Tonnes
Russia has larger areas under production of wheat
leaving it with a surplus to export.
16%,
16%
14.50%,
16%
11.40%,
11%11.10…
10.10%,
10%
36.90%,
37%
Export Share
Canada United States Australia
France Russia Others
6.2 5.6
4.4 4.3 3.9
0
2
4
6
8
Canada United
States
Australia France Russia
Export Value( in
Billion $)
Global
Exports
Sources: trademap.org
Comtrade.un.org
Mapsofworld.org

3. Global
Exports
India’s
Export
Major
Exchanges
Trading
Markets
Analysis of
Global Trade
India’s
Import
Analysis of
Arrivals
Country: Egypt
Quantity Imported: 8,667,527 Tons
Value of Imports: $ 1.8 Billions
Egyptians are among the highest per capita
consumers of wheat with 72% of Egyptian diets
consisting of wheat corn and rice. With a quarter
of Egypt’s 84 million people living below the
poverty line of $1.65 a day, millions depend on
subsidized bread that sells for less than 1 U.S.
cent per loaf.This Supply is due to the imported
wheat.
Country: Algeria
Quantity Imported: 8,108,549 Tons
Value of Imports: $ 1.95 Billions
Wheat is the staple grain of food and
accounts for about 75% of the calories
Consumed. Algerian wheat
consumption has risen slightly in recent
years as a result of increased
urbanization, population growth as
well as increased milling capacity
Country: Italy
Quantity Imported: 7,148,349 Tons
Value of Imports: $ 2.03 Billions
Italians include more wheat products such as bread and
pasta in their diet .Italy is known the world over as the
home of pasta, and Italy’s grains sector is notable for the
importance of durum wheat processing. Italy maintains
the primacy as ‘The Pasta Country, which also results in
higher export related consumption of wheat.
Country: Indonesia
Quantity Imported: 7,412,019 Tons
Value of Imports: $ 2.08 Billions
At least since the early 1970s, processed
wheat-based foods have become part of
daily consumption in Indonesia. Instant
noodles are the most popular processed
wheat-based food item, not only in urban
but also in rural areas. Thus, it becomes I
Imperative for this country to import wheat
.
Country: Japan
Quantity Imported: 5,530,693 Tons
Value of Imports: $ 1.65 Billions
Japanese were fond of rice initially,
But in the aftermath of world war 2,
The US propaganda and various projects run
By the US government in disguise of aid led to
A larger acceptance and later demand of wheat
By Japan.
1
2
3 4
5
5%5%5%
5%
4%76%
Share in world
Imports
Indonesia Italy Algeria
Egypt Japan Others
2.08 2.03 1.95 1.8 1.65
0
1
2
3
Indonesia Italy Algeria Egypt Japan
Import Value(In Billion $)
Global
Imports
Sources:
trademap.org
Comtrade.un.org
Mapsofworld.org

4. Major
Exchanges
Trading
Markets
Analysis of
Global Trade
India’s
Import
Analysis of
Arrivals
Global
Imports
Global
Imports
India’s Export Data
Source: http://agriexchange.apeda.gov.in/
19
7.5 7
4.5
2.5 2.5 2 1.6 1 0.8
0
5
10
15
20
TOP 10 EXPORTERS DESTINATIONS
(IN LAKH TONNES) 2013 -14
17
10.5
5 4.7 4.8 5
2.2
0 0.5 1.5
0
5
10
15
20
TOP 10 EXPORTERS DESTINATIONS
(IN LAKH TONNES) 2012 -13
3.41
1.19 0.99
0.15 0.07 0.07 0.04 0.03 0.04 0.36
0.00
0.50
1.00
1.50
2.00
2.50
3.00
3.50
4.00
TOP 10 EXPORTERS DESTINATIONS
(IN LAKH TONNES) 2015 -16
11.23
3.91 3.48
1.9
1.12 1.03 1.04 1.11 0.81 0.79
0
2
4
6
8
10
12
TOP 10 EXPORTERS DESTINATIONS
(IN LAKH TONNES) 2014 -15
India’s
Export
• Wheat Production
has come down to
88.94 million tonnes
from 95.85 million
tonnes achieved in
the previous year
because of drought
and unseasonal
rains
• The exports have
also decreased in
the same ratio
• Highest export to
Bangladesh fell to
3.41 LT in 2015
compared to 11.23
in 2014

5. Major
Exchanges
Trading
Markets
Analysis of
Global Trade
Analysis of
Arrivals
India’s
Export
Global
Imports
Global
Imports
India’s Import Data
Source: Business Standards
2010 2011 2012 2013 2014 2015
Fig in Tonnes 272000 15000 16000 25000 45000 2000000
0
500000
1000000
1500000
2000000
2500000
India’s
Import
• Between 2012 and 2014, India reached wheat production volumes near 95 million
tonnes per season, and it is the world’s second-largest, single-country wheat
producer behind China.
• Due to severe drought in 10 states in 2015-2016 the area under wheat has
reduced by 4.38%
• Production has come down to 88.94 million tonnes from a record 95.85 million
tonnes achieved in the previous year because of drought and unseasonal rains
• In above graph we can see that the import increased almost 45 times compared to
last year owing to low production and increased domestic consumption.
High dependence on Monsoons
• Indian wheat farming relies heavily on a sufficient
monsoon prior to the start of planting in October
• The monsoon, or rainy season, typically lasts from July
through September
• Following the second consecutive below-average
monsoon, India has been facing dry conditions for last
two year’s wheat crop
Poor storage facilities
• In order to protect food security and sustain the price
support program, the government-owned Food
Corporation of India (FCI) buys and stores a lot of the
country’s wheat crop
• In the last two years food grain wastes has increased to
40,000 tonnes owing to poor storage facilities, pilferage
and transit loss
Hoarding
• Hoarding by traders and farmers expecting price rise in
the market is also contributing to the wastage and rise of
inflation in India.
Reasons of rising Imports
India’s Imports (in Tonnes)
Source: http://timesofindia.indiatimes.com/india/In-2-years40000-
tonnes-of-grain-went-down-the-drain/articleshow/47669621.cms

6. Major
Exchanges
Trading
Markets
Analysis of
Arrivals
India’s
Import
India’s
Export
Global
Imports
Global
Imports
Analysis of International Trade in Wheat
Source: http://www.fas.usda.gov/
Analysis of
Global Trade
Global production in 2016/17 is expected to rise to a new record despite a sharp
reduction in the EU. A record crop in Russia as well as larger crops in Australia, Canada,
Kazakhstan, Ukraine, and the United States more than offset the significant decline in the
EU crop and a slight reduction in Argentina.
Global trade is up month-to-month, but remains fractionally below the previous
year’s record. The upward revision is based upon larger projected imports for the
EU and growing demand across much of Asia and Africa.
Imports by the developing countries are expected to fall most, whereas total
imports by the developed countries are likely to remain at the same level as in 2015
Expected good monsoon in India will contribute to rise in Wheat Exports globally.
Following two consecutive years of low production trends are set to change from this
year.

7. Major
Exchanges
Analysis of
Arrivals
Analysis of
Global Trade
India’s
Import
India’s
Export
Global
Imports
Global
Imports
Source: http://www.crnindia.com/commodity/wheat.html
International Trading Market of WheatDomestic Trading Market of Wheat
Uttar Pradesh
• Meerut
• Hathras
• Saharanpur
• Barreily
Punjab:
• Amritsar
• Moga
• Ludhiana
• Jalandhar
• Bhatinda
• Japan
• Australia
• Bulgaria (Sofia Comm. Exchange)
• China
Globally wheat is traded at
• Chicago (CBOT)
• Canada (Winnipeg Commodity Exchange)
• Kansas (Kansas City Board of Trade)
• Missouri
• In Domestic market, wheat is generally traded in places close to its production to
reduce the transportation cost.
• Punjab and Uttar Pradesh are the major trading market of India.
• Uttar Pradesh is the leading producer state in India followed by Punjab and
Haryana.
• Most wheat is consumed within the country where it is produced, roughly
one-fifth of the annual crop is exported
• World wheat trade was estimated at 108 million tonnes in 1995, most of
which was imported by developing countries
• China, the world’s largest wheat producer, is also the world’s largest wheat
importer
Trading
Markets

8. Analysis of
Arrivals
Trading
Markets
Analysis of
Global Trade
India’s
Import
India’s
Export
Global
Imports
Global
Imports
• European benchmarks for products including Milling Wheat, Rapeseed
and Corn
• High levels of liquidity combined with the price volatility inherent in the
underlying markets provides a wide range of trading opportunities over
both the short and long term
• Euronext’s Milling Wheat No. 2 futures is relied upon as the European
benchmark for the pricing of physical milling wheat
• European Milling Wheat is used mainly in the milling, starch and food
industries
• Primary products traded at the exchange were futures contracts on hard
red winter wheat
• Facilitated the transfer of ownership of the futures and options contracts
through the open outcry system
• In 1982, the exchange introduced Value Line futures, making it the first
exchange offering a stock index futures contract
• Electronic-trading platform since 2014
• On October 17, 2012, CME Group announced it would acquire the
exchange for $126 million in cash
• Abides by the principle of openness, fairness, justness and good faith,
provides a marketplace with associated facilities and services for the futures
trading and regulates the futures trading
• Functions according to Futures Trading Management Ordinance, Futures
Exchanges Regulation
• Carries out futures trading systems such as Margin Requirement System, Daily
Price-limit System, Mark-to-the-market System, Physical Delivery System
• Fully functional electronic system, including trading, delivery, clearing, risk
control, news release, member services
• Member of International Options Market Association since June 1995
• Established, liquid Wheat futures markets
• Tight bid-ask spreads
• Robust Wheat options markets, for event more flexibility in hedging and
trading strategies
• Availability of Wheat Calendar Spread Options (CSOs) for a more efficient roll
strategy
• Spreading opportunities with other CBOT grain and oilseed markets
• Access to Minneapolis (MGEX) via the fast, efficient CME Globex electronic
platform
Major International Exchanges
Major
Exchanges

9. Trading
Markets
Analysis of
Global Trade
India’s
Import
India’s
Export
Global
Imports
Global
Imports
Analysis of
Arrivals
Major Domestic Exchanges
National Commodity & Derivatives
Exchange Ltd. (NCDEX)
• National Commodity & Derivatives
Exchange Limited (NCDEX) is a
professionally managed on-line multi
commodity exchange.
•The shareholders of NCDEX comprises
of large national level institutions, large
public sector bank and companies.
•NCDEX is the only commodity
exchange in the country promoted by
national level institutions.
•NCDEX is a public limited company
incorporated on April 23, 2003 under
t the Companies Act, 1956
• NCDEX is regulated by Securities and
Exchange Board of India
Indian Commodity Exchange
•Indian Commodity Exchange Limited is
deemed recognized Stock exchange under the
SCRA,1956 in terms of Section 131(B) of
Finance Act, 2015
•Providing a nation-wide on-line trading
platform in commodity derivative.
•Put in place assaying and warehousing
facilities in order to facilitate deliveries
•Encourages participation of actual users to
benefit from the opportunities of hedging, risk
management and supply chain management in
the commodities markets
•The Exchange is a public-private partnership
with Reliance Exchange next Ltd., MMTC Ltd.,
Indiabulls Housing Finance Ltd., Indian Potash
Ltd., KRIBHCO and IDFC Bank as major
shareholders.
Multi Commodity Exchange
• India’s first listed exchange
•State-of-the-art, commodity futures
exchange that facilitates online trading, and
clearing and settlement of commodity
futures transactions
•Started operations in November 2003,
operates under the regulatory framework of
Securities and Exchange Board of India
•Offers facilities such as calendar-spread
facility
• Certified in ISO 9001:2008 Quality
Management System, ISO 27001:2015
Information Security Management Standard
and ISO 14001:2004 Environment
Management Standard
Major
Exchanges

10. Major
Exchanges
Trading
Markets
Analysis of
Global Trade
India’s
Import
India’s
Export
Global
Imports
Global
Imports
Analysis of Arrivals
• For domestic arrivals roadways are the primary means of
transportation
• Arrivals come into local mandi’s only after permission from the
local mandi officer
• Farmers reports their produce at the APMC gate where it is
recorded for statistical purpose.
• Traders contact commission agents and negotiate quantity and
price.
• Local taxes like Octroi, mandi tax, etc. also apply in states like
Maharashtra, U.P. etc.
• Bags used for Wheat packaging are generally jute and fiber bags
• Delivery from mandi to buyer is done generally via roads or rails.
Exporter/
Trader Mandi
0
1000000
2000000
3000000
4000000
5000000
6000000
7000000
8000000
9000000
AndhraPradesh
Assam
Bihar
Chattisgarh
Gujarat
Haryana
Jharkhand
Karnataka
Kerala
MadhyaPradesh
Maharashtra
Mizoram
NCTofDelhi
Orissa
Punjab
Rajasthan
Telangana
UttarPradesh
Uttrakhand
WestBengal
Arrivals (Tonnes)
Arrivals
Source: http://agmarknet.dac.gov.in/SearchCmmMkt.aspx
Domestic arrival
Transport to
port via
cargo rail
Exported in
cargo ship in
Tramps
Exported
receives
the goods
Analysis of
Arrivals
41.82
4.28 12.76 15.83 0.01 18.56
58.54
214.08
287.68
-6.6 -8.71
84.83
703.86
-1.14
-100
0
100
200
300
400
500
600
700
800
Arrival analysis of last two years
% Change(Over Previous Month) % Change(Over Previous Year)
Importer
- Wheat is a Rabi crop that is grown in the winter season
- Usually the arrival of wheat crop starts in the first week of
April
- Wheat production in the states of Uttar Pradesh and Madhya
Pradesh have increased and decreased respectively over the
last years and so the arrivals at local mandis have also
changed comparably in these states (compared in above
graph)
- The production increased mainly due to increase in acreage
area, use of pesticides etc.
- The forecasted arrivals for the next year is also high since a
good monsoon is expectedGlobal Trade