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A cargo of wheat from India has arrived and passed inspection at a port in Vietnam in what could be the first such bulk movement recorded, Fastmarkets Agricensus analysis of line-up and maritime data showed Monday.
The arrival of the vessel, on April 22, is a sign of the growing potency for Indian wheat exports amid heavy disruption to Black Sea supplies, with the move coming nearly a week after Fastmarkets Agricensus revealed Indian wheat had been bought by Egypt in what is likely to be another first.
The vessel, the Omicron Nikos, was carrying 72,600 tonnes of Indian wheat that left the Indian port of Kandla on April 8.
Trade sources have been closely watching the vessel’s progress and whether the cargo passes the country’s phytosanitary tests.
Vietnam has cited quality issues, such as stones in the cargo or the fungal infection karnal bunt, that have prevented the country from importing volumes from the origin in the past.
As such, there is already a second vessel loading in Indian ports which is destinated for Vietnam, according to local sources, with more expected to follow.
“I think there are more CNF sellers trying to sell more Indian wheat to Vietnam for nearby [loading dates],” a Vietnam-based trader told Fastmarkets Agricensus.
Meanwhile, after Indian wheat was approved for shipments into Egypt last week, local prices have firmed up to currently stand at levels around $345-350 per tonne FOB Kandla.
And, with buyers able to use it as both feed wheat and milling wheat, those price levels mean feed wheat buyers could find it more profitable to make a switch back to corn, which is currently trading around the same level as wheat on a CFR delivered basis.
Meanwhile, for milling wheat, the current price increase for Indian origin supply is likely to also tip the balance back in favor of Australian feed wheat – which is usually quoted as a better quality product.
Prices for Australian wheat are again becoming competitive as Fastmarkets Agricensus heard selling indications reported at $390 per tonne CFR Vietnam.
“Recently, Aussie feed wheat has quoted more competitively than Indian wheat. Therefore, feed millers are not interested in looking for Indian wheat now,” the same trader said.
Vietnam is among the world’s biggest wheat importers, with the USDA’s import estimate for the 2021-2022 marketing year standing at 4.1 million tonnes and Australia traditionally the country’s main supplier, accounting for around half of the entire import slate.
Keep up to date with the wheat market and trends shaping the agricultural landscape, visit our dedicated wheat market news page.