Increased wheat seeding, increased production forecasts, and (barely) sufficient stocks are all contributing to a delay by the Indian government on any decisions to import wheat, at least until a better reading of crop condition is available in early March, wheat expert Raj Kapoor told U.S. Wheat Associates. India's Ministry of Agriculture is currently estimating an increase of about 3 percent in wheat planting area, about 27.3 million hectare compared to 26.49 million hectare last year. Wheat production for 2005/06 is estimated at 75 MMT compared to 72.4 MMT last year, subject to good weather conditions. Stock levels, as of December 1, are estimated at around 7.8 MMT, compared to 10.6 MMT at the same time in 2004. By January 1, Mr. Kapoor reports, stocks will likely be around 6.7 MMT, against the buffer stock requirement of 8.2 MMT. "These stocks are just sufficient to meet requirements of wheat distribution for the Public Distribution System and for open market sales," Mr. Kapoor says. "I anticipate that another 2 MMT will be needed to bring stocks to more dependable stock levels. But the government is facing some political pressure and is unlikely to make any decision for wheat import soon. Authorities may decide whether to import wheat after they have a chance to evaluate the crop condition in March."
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