France eyeing Indian market for wheat exports

Bangalore: France, which sold wheat to India for the first time last year, is hoping to become a long-term supplier to the South Asian nation, a senior industry official said on Friday.

"It will all depend on the Indian crop," Francois Gatel, director of the Association for the International Promotion of French Grain, told Reuters in an interview on the sidelines of an international wheat conference.

Last year, India bought an estimated 200,000 tonnes to 300,000 tonnes of French-origin wheat, out of total contracted imports of about 1.8 million tonnes, although a large crop this year makes Indian imports unlikely.

Gatel said France, which accounts for about 60 per cent of European Union wheat exports, was likely to produce a larger crop this year than last, putting it in a stronger position to export. "Last year, we had a bad year. On an average we have seven tonnes yield per hectare, but last year was about 6.5," Gatel said.

"We expect to have again this year what we have been accustomed to - 7 tonnes per hectare. That would lead to 35 million tonnes output," he added.

Gatel said France would have about 6 million tonnes of wheat for export outside Europe this year.

Industry officials are not expecting India to import wheat this year because of a bumper crop and plentiful carryover stocks, although some traders said a few deals were possible if the government fails to procure grain from farmers.

Vinod Kapoor, former president of the Roller Flour Millers Federation of India, said on Thursday that early rains had favoured development of the Indian wheat crop and there should be a harvest of more than 75 million tonnes in 2008, slightly higher than in 2007.

Gatel said his organisation was not looking at short-term opportunities only. "Our customers must be confident about French quality and that is not achieved in one time only," he added.

But Indian traders said that plentiful imports from France would happen only if Australia faces problems in exporting large amounts of the grain.

Traditionally, France exports to European countries such as Italy, Spain and Greece and northern and western African nations. But Asian countries - China, Sri Lanka and Thailand, in addition to India - have in the past bought French wheat.

"We are expecting an increase in the yield over the next ten years. By 2015, we expect to reach 38 million tonnes wheat production and then, we could have 8 million tonnes available for exports outside of Europe," Gatel said.