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REFILE-OUTLOOK-India wheat seen up on hopes of higher demand
July 2, 2012 / 10:31 AM / 5 years ago

REFILE-OUTLOOK-India wheat seen up on hopes of higher demand

(Refiles to add dropped word ‘OUTLOOK’ in headline)

MUMBAI, July 2 (Reuters) - Indian wheat futures are likely to rise this week on some improvement in demand and reduction in fresh supplies in the spot market following the end of the arrival season.

“Wheat prices were continuously falling on surplus production for the last three to four months, and we could see some consolidation in its prices,” said Chowda Reddy, senior analyst with JRG Wealth Management.

At 1019 GMT, the August wheat contract on the National Commodity and Derivatives Exchange (NCDEX) was up 0.25 percent at 1,210 rupees per 100 kg.

The contract could touch the 1,250 rupees per 100 kg-level this week though there is resistance at this level, Reddy said.

The recent surge in global wheat prices and a weakness in currency have raised hopes of higher exports from the south Asian nation which lifted a four-year-old ban on shipment of wheat in September, traders said.

Benchmark U.S. wheat corn and wheat futures rallied this week on concerns over supplies from top exporters, the United States and the Black Sea region.

Agribusiness giant Cargill Inc. has sold about 32,000 tonnes of Indian wheat to Indonesia in the first large shipment of the grain to Asia in at least seven years.

India, the world’s second-biggest wheat producer, is struggling to trim bulging stockpiles that have filled up its storage facilities after the bumper harvests of recent years.

Grain stocks in Indian government warehouses stood at a record 82.4 million tonnes on June 1 although there was storage space only for 63 million tonnes, forcing authorities to store the overflow in the open. (Reporting by Deepak Sharma; Editing by Anupama Dwivedi)

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