WHEAT

Presented by :
JYOTI BHUSHAN(1224108216)
LAWI ANUPAM(1224108221)

GITAM INSTITUTE OF INTERNATIONAL BUSINESS

VISAKHAPATNAM
 INTRODUCTION
• Staple food
• Over 30,000 varieties
• Cultivated for over 6,000 years
• Needs cool winter and hot summer

Properties
 Sweet, cool

 Cures excessive humor of wind and bile in the body,

 Rich in proteins, causes phlegm, increases virility, gives strength, is very

nutritious
 ` Makes the complexion of the body fair.
INDIAN WHEAT PRODUCTION
• Produced in Indo- Gangetic region
• Largest producing states – Punjab, Haryana, Uttar Pradesh , Madhya
Pradesh, Rajasthan and Bihar
• India’s wheat production was 78.57 million tonnes in 2008
GLOBAL WHEAT PRODUCTION
 After 1960’s – GREEN REVOLUTION
INDIA’S CONTRIBUTION
 GLOBAL WHEAT PRODUCTION AND
CONSUMPTION
• Largest wheat producing countries - China, India, United States, Russia,
Australia
• The consumption of wheat in the world is a huge 580 million tons but is
successfully kept satisfied with an equally high production figures.
GLOBAL WHEAT PRICE
 FACTORS INFLUENCING WHEAT
MARKET
• Crop size
• Crop conditions
• Weather conditions
• The level of surplus or shortfall during harvesting and peak
season
• Agricultural and economic policies in the country and abroad
• Worldwide demand for wheat
• The relative strength of the currency
• Prices fluctuations of the competitive and substitute products
• Technological improvements
 APPLICATIONS

 The bread made of wheat flour is very relishing, nourishing, strength giving
 Very good for people having very high appetite
 It cures flatulation and causes the formation of phlegm.
 Wheat flour cures constipation, ley loosening up the hardened stool.
 Drinking the solution of wheat dissolved in milk and mixed with some
sugar cured the bleeding of the nose.
 Increases the resistance power of the body
 Cures constipation and is very beneficial for cancer patients
 Forage crop for the livestock
 PHYSICAL TRADING
• Chicago (CBOT) • Amritsar (Punjab)
• Canada (Winnipeg Commodity • Moga (Punjab)
Exchange) • Ludhiana (Punjab)
• Kansas (Kansas City Board of • Jalandhar (Punjab)
Trade) • Bhatinda (Punjab)
• Missouri • Meerut (Uttar Pradesh)
• Japan • Hathras (Uttar Pradesh)
• Australia • Saharanpur (Uttar Pradesh)
• Bulgaria (Sofia Commodity • Barreily (Uttar Pradesh)
Exchange)
• China
 COMMODITY EXCHANGES FOR
WHEAT
Wheat futures are traded on the

World exchanges
• Chicago Board of Trade,
• Kansas City Board of Trade, and
• Minneapolis Grain Exchange
• Dalian Commodity Exchange

Indian exchanges
• National Multi-Commodity Exchange in India (NMCE)
• National Commodity and Derivatives Exchange (NCDEX)
• Multi Commodity Exchange of India Ltd (MCEIL)
 CONTRACT SPECIFICATION
Symbol Wheat
Description WHEATMMYY
Trading system MCX
Contracts for trading
October contract After approval of the Commission to
20th October of the contract year
November contract After approval of the Commission to
20th November of the contract year

December contract After approval of the Commission to

20th December of the contract year

Trading period Mondays through Saturdays

 CONTRACT SPECIFICATION
Contract horizon Six months
Trading units 10 MT
Quotation/Base value 100 kg
Tick size (minimum price movement) 10 paise
Maximum order size 500 MT
Daily price limits 3 + 1%
Price quote Wheat [ Standard Mill Quality] Ex-
Warehouse Delhi inclusive of all taxes
Initial margin 5%

Special margin In case of additional volatility ,a special

margin at such percentage ,as deemed
fit ,will be imposed on both buy and sale
side in respect of all outstanding position
 CONTRACT SPECIFICATION
DELIVERY
Delivery unit 10 MT with tolerance of 500kgs
Delivery margin 25%
Delivery center (s) Exchange approved warehouse at Delhi

DEFECTS
Foreign matter( organic/inorganic) 3.00%(max)
Damaged kernels (other than infestation 4.00%(max)
damage)
Shrunken ,shriveled and broken grains 6.00%(max)

Infestation damaged kernel 1%(max)

Total defects (1+2+3+4) 9% basis
Acceptable up to 13%
Rejected if total defects is Above 13%
 INDIAN SCENARIO
• Largest area in the world under wheat but in terms of production, we are third largest.
• India produces about 65-75 million tons of wheat a year and consumes around 70-72
million tons of wheat a year.
• The major wheat producing states of India are Uttar Pradesh, Punjab, Haryana,
Madhya Pradesh, Rajasthan and Bihar accounts for 90 % of total production.
• Wheat is sown during October to December and harvested during March to May. The
wheat-marketing season in India is assumed to begin from April every year.
• The total procurement of wheat by Government agencies ranges from 8 to 20 million
tons, accounting for only 15-20% of the total production.
• Minimum Support Prices (MSP) and Central Issue Price (CIP) are the instruments
used by the government to maintain food buffers for food security and stable price.
• The MSP in 2008-09 was hiked from Rs.1000 to Rs.1080.
• The support price operation and the Public Distribution Systems (PDS) play a
significant role in maintaining reasonable and stable food grain prices in the country
for both the producers and consumers.
• India exported around 5 million tons subsidized by Government in 2003-04, as a
result of surplus stock. Southeast Asia and Gulf countries are major importers of
Indian wheat.
 GLOBAL SCENARIO
• The world wheat production in the recent years has been between 560-580
million tons a year.
• India, EU-25, China, India and US, the four largest producers account for
around 58% of the total global production.
• The major consuming countries of wheat are EU, China, India, Russia, USA
and Pakistan.
• Around 16-19% of the world wheat production is traded annually between
countries. The annual world trade in wheat is to the extent of 102-106 million
tons.
• America, Australia, Canada, EU-25 and Argentina are the five largest
exporters of wheat in the world.
• Major importing countries are European Union, China, Egypt, Japan, Brazil
and European Union.
• The import amount varies year to year depending upon the domestic
production.
THANK YOU