India on Monday received offers for 330,000 tonnes of wheat from three global firms at sky-high prices against a recent tender, reflecting shrinking supplies and a surge in US wheat futures on strong exports. Cargill emerged as the lowest bidder for the tender issued by the State Trading Corp, offering 65,000 tonnes of grain at $459.90 per tonne, trade officials said.
"The market is very, very high, prices are hitting the roof," an STC official told Reuters before bids were opened. US wheat futures jumped more than 3 percent and surpassed $10 a bushel for the first time as strong US export numbers amid dwindling world supplies prompted funds and investors to rush to cover positions.
Wheat prices have nearly doubled since the start of the year and industry officials said crop worries and strong global demand will keep them firm until a clearer picture emerges in January about US plantings. Glencore offered the STC 200,000 tonnes to be delivered at two Indian ports for $462-465 per tonne, traders said.
They said a Toepfer also bid, offering 65,000 tonnes of wheat at 4 ports in the range of $562-599 per tonne. State-run STC floated the tender for 350,000 tonnes of grain last week, but it was not clear how much wheat it would buy given the high prices.
Indian state-run firm PEC Ltd this month decided to buy only 150,000 tonnes of wheat at around $395 per tonne against a tendered quantity of 350,000 tonnes. Three state-run firms, MMTC, PEC and State Trading Corp Ltd have been authorised by the government to import up to one million tonnes of wheat, equally split between them.
Last month, MMTC bought 342,000 tonnes of wheat at a weighted average price of $400 per tonne. In 2006, India, the world's second-biggest wheat producer, imported the grain for the first time in six years, buying 5.5 million tonnes as prices flared due to a poor crop.
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