Wheat imports by the private trade have started trickling into India after a cut in import duty, but are expected to pick up in October or November when domestic supplies dry up, traders said on Wednesday.
They said the small quantities being purchased were in anticipation of a price rise early in winter. Last month, the government cut the import duty on wheat to five from 50 percent to boost supplies in the local market.
"One or two deals have been struck by some private traders. The quantity will not be more than 100,000-150,000 tonnes," a Mumbai-based trader with a commodities firm said. The duty cut was made to help private players like flour mills and bread and biscuit manufacturers import wheat in order to ease pressure on supplies.
Industry officials said the move had not helped the immediate supply situation as the landed cost at five percent duty would be slightly higher than the local prices.
D.P. Singh, president of the All India Grain Exporters Association, said the imports would really pick up after the prices rise by around 500 rupees per tonne in the coming months. Spot prices have been hovering around 8,500 ($181) rupees ($202.5) per tonne, varying from region to region in India.
"We expect more imports by private trade in another four to five months, when domestic supplies are at their lowest," said another Mumbai-based trader.