Indian wheat was alleviating the food crisis. Then exports were banned

“We already have enough food for our people but it seems our farmers have made arrangements to feed the world,” Modi said. She said in April. “We are ready to send relief from tomorrow itself.”

The second largest wheat producer in the world after China The conversation was really easy. In the 12 months to March, India benefited from higher global prices, exporting Record 7 million metric tons of cereals. That was 250% higher than the previous year’s volumes. It also set record export targets for next year.

Now, those lofty goals of exporting wheat have been abandoned forbidden As life threatening heat waves in south asia Undermining production and pushing domestic prices to record levels.

The move shocked international markets on Monday – more since it came just days after India reassured the world that it was unprecedented. A hot wave no Effect its export plans. Global wheat prices rose 6%, with futures trading in Chicago at $12.4 a bushel, the highest price in two months. Tuesday’s wheat futures eased slightly but are still nearly 50% higher since the war began.

But the warning caused by the export ban highlights the fragility of the global food supply.

How did we get here?

Ukraine is among the top five global exporters of a variety of major agricultural products, including corn, wheat, and barley, according to the U.S. Department of Agriculture. It is also the main source of both sunflower oil and meals.

But the food situation was tense even before the fighting began in Europe. Crowded supply chains and unpredictable weather patterns – often as a result of climate change – have already pushed food prices to their highest level in nearly a decade. Affordability has also been an issue after the pandemic has left millions out of work.

Following Modi’s promise, many vulnerable nations were dependent on supplies from India.

Indian wheat exports Oscar Tjakra, senior grain and oilseed analyst at Rabobank, told CNN Business that this year is particularly significant against the backdrop of the Russian-Ukrainian crisis.

“The ban will reduce the availability of global wheat for export in 2022 and will provide support for international wheat prices,” he added.

On Monday, Ambassador Linda Thomas Greenfield, the US ambassador to the United Nations, said she hoped Indian authorities would “reconsider this situation.”

Escalation of food protectionism

The government also said the restrictions do not apply “in cases where private traders have made advance commitments”, and countries requesting supplies “to meet food security needs”.

According to Tagkra, these exceptions should be considered “good news,” but they make it difficult to assess the impact of the ban on global trade.

He added that the “severity of the impact” of the ban “will still depend on the volume of Indian wheat exports that are still permitted at the government level and the volume of wheat production from other global wheat producers.”

Some analysts in India say allowing unrestricted exports was a bad idea in the first place.

“We don’t know what will happen to the climate in India,” Devinder Sharma, an expert on agricultural policy in India, told CNN Business.

India is among the countries expected to be most affected by the effects of the climate crisis, according to the United Nations body on climate change, the Intergovernmental Panel on Climate Change (IPCC).

Sharma added that if crops are devastated by unpredictable weather, India may have a shortage of food, and she is left “standing with the begging bowl”.

India is not the only country looking inward and restrictions on agricultural exports.

“With inflation already rising in Asia, risks are skewed towards more food protectionism, but these measures may ultimately exacerbate food price pressures globally,” Nomura analyst Sonal Varma said in a note on Saturday.

It added that the impact of India’s ban on wheat exports would be “disproportionately felt by low-income developing countries”.

Nomura said Bangladesh is India’s top wheat export destination, followed by Sri Lanka, the United Arab Emirates, Indonesia, Yemen, the Philippines and Nepal.