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Commodity
WHEAT
Description | Overview | History | Cultivation pattern | Wheat producing countries | Indian wheat market | Major trading centers
Description


Wheat is a cereal grain that belongs to the grass family of the genus ‘Triticum’. A dry, one seeded fruit named kernel is obtained from this spiky grass like grain, which is ground to make flour and is consumed throughout the world as one of the most important staple food. It is the second largest cereal grain consumed on earth and that is why it is widely cultivated in more than 30000 varieties.

Wheat is important especially for making breads and other bakery products as it has got the maximum number of glutens as compared to any other grain. This crop is also grown as a forage crop for the livestock.

Overview


Wheat is a very important edible cereal grain crop. As already mentioned, it is the second largest grain crop consumed after rice. The cultivation of wheat has its own advantages like it has a very good yield per unit area, has a relatively short growing duration period and the production of wheat is comparatively easier than the other grain crops as it grows well in the temperate regions. That is why it serves as a very good cash crop and proves its dominance in the world commerce. Gluten, which is a primary constituent in raised bread, is found in wheat and that is why most of the bakery products are made from wheat only.

The world production of wheat figures over 585 million tons annually. The largest producer of wheat in the world is the European Union followed by China, India and United States of America. The total wheat production of the world is slightly concentrated is clear from the fact that these four producers contribute to around 60% of the total production. The consumption of wheat in the world is a huge 580 million tons but is successfully kept satisfied with an equally high production figures. Consumption has been constantly increasing during the last 10 years with the increase in population, and alarmingly, the consumption is prepared to shoot up further and is expected to reach up to 775 million tons in 2020. Wheat is consumed all through the globe and the leading countries in this list are

  • European Union

  • China

  • India

  • Russia

  • United States of America

  • Pakistan

The above list makes it clear that the largest producers of wheat in the world are also the largest consumers of the world, which means, most of the wheat production is consumed at the place of production. The export market of wheat is getting competitive with the new entrants like India into it and the export figures hover around 200 million tons. The major exporting countries of this crop are: -

  • United States of America

  • Australia

  • Canada

  • European Union

  • Argentina

The imports of wheat are done by the countries, which have a high domestic demand and a fluctuating production level. That is why the countries shuffle in the list of highest wheat importing countries. The world import figures sum up to 100 million tons and are currently done by more than 100 countries. The major countries are

  • European Union

  • China

  • Egypt

  • Japan

  • Brazil

  • Mexico

  • Indonesia

  • Algeria

  • Philippines

  • Iraq

 

History

According to the archeological evidences, some species of wheat grew as a wild grass in the Middle East areas of Syria, Israel, Jordan, Turkey and Iraq. With the shortages of food, wheat was domesticated and cultivated 11000 thousand years ago. In fact, it was one the first crops cultivated ever. This was only due to the cultivation of this crop that people came to know how to produce their own food and in turn started to settle than wander around.

 

In around 6700 BC, Swiss people came to know the use of wheat in flat cakes. Egyptians were the first one to develop the concept of yeast bread and even the workers who were indulged in the construction of pyramids were paid in bread! Wheat now started gaining popularity and the concept of wheat farming spread and reached Ireland, Ethiopia, Spain and India. In 150 BC bakeries were largely set up to produce bread in Rome.

 

The British took wheat to the new world as the climate and soil of England was not suitable for the wheat production. With time, wheat became so significant as a staple food crop, that now; the demand of wheat is directly proportional to the population level.

Cultivation pattern

Wheat was one of the first crops that were cultivated in the world thanks to its adaptability to wider range of climatic conditions and soils making it a very easy to produce crop in that time when man didn’t even know the basics of living. Wheat requires a cooler weather and a good level of moisture in the early plantation period and once the grain is formed, it needs a warmer weather to dry up. That is why the best-suited climate needed for the wheat crop to prosper is the temperate climate.

In USA, the wheat seeds are sown in the months of September and October. After February, when the snow in those areas starts to melt, the wheat crop starts to shoot up and during summers it is left to develop and finally it is harvested in the months of June, July and September. In India, wheat is cultivated as a Rabi crop and it is planted in the month of October. It is harvested in the months April and May.

Wheat producing countries

 

The world production of wheat sums up to over 585 million tons annually. As mentioned above, the production of wheat is slightly concentrated in the hands of a few countries as the top four producers of the world contribute around 60% of the world’s total production. The production-wise list of the major producers of wheat is given below

 

  • European Union

  • China

  • India

  • United States of America

  • Russia

  • Canada

  • Australia

  • Pakistan

  • Turkey

  • Argentina

  • Iran

  • Kazakhstan

The largest producer of wheat in the world is European Union that contributes to around 1/4th share to the world’s total production. As it is said that the demand of wheat increases with the increase in population, the nations having the largest population in the world i.e. China and India stand at the 2nd and 3rd position in the largest wheat producing nations’ list in order to satisfy the domestic consumption demand. These two countries contribute 14 % and 12% respectively in the world’s total production. India has shown a high rise in production of wheat after the green revolution and taken a lead from USA in recent times.

Wheat is produced on approximately 2.5 million square kilometers of the world. The maximum area in the total cultivated area of wheat is constituted by India at around 13%. The other major countries that have a significant impact on the total area contributed for wheat production are

  • European Union

  • Russia

  • China

  • USA

  • Australia

  • Canada

  • Kazakhstan

Production of wheat in India

The following areas in India are the major wheat producing areas in the country and contribute to around 92% of the total production in the country

  • Uttar Pradesh

  • Haryana

  • Punjab

  • Rajasthan

  • Madhya Pradesh

  • Gujarat

  • Bihar

India produces around 75 million tons of wheat every year and stands at the third position in the list of the major wheat producers in the world. India also stands at the top in the world in terms of area covered in production of wheat. Uttar Pradesh is the leading producer state in India followed by Punjab and Haryana. Wheat occupies a major share of 35% production in the total production of crops cultivated and 65% of total cropped area in the country. This share in production and area covered of the crop has increased since independence and is also constantly rising. The yield of wheat in kilograms per hectare has also risen significantly from 522 kg/ha in 1950/51 to 1620kg/ha in 1998/99

Indian wheat market

India is the third largest producer of the wheat crop. It has been successfully fulfilling its large domestic consumption demand in the past few years and has been exporting the surpluses to give the major exporters of the world a good competition. India produces an average of 75 million tons wheat each year but the production of this crop is generally fluctuating due to the uncertainty of the rainfall. The state of Uttar Pradesh leads the production in the country. For self-consumption purposes, the farmers retain around 48% of their production and hence it is not entered into the total production figures of the country.

Indian wheat is generally medium hard bread wheat. It is a staple food of this country. That is why almost all of the wheat produced is consumed. India holds the third position in the major wheat consumer’s list after European Union and China consuming around 72 million tons of wheat. The demand-supply flows with in the country are largely interfered by the government of the country so as to make sure that the grain supplies be stable and prices do not get affected.

With the introduction of the new technologies in the agricultural sector, there has been a constant increase in the productivity of wheat produced and hence there has been a growth in the surplus level of the country and consequently a rising trend in the wheat export. World market sees a dependable supplier of wheat in the form of India. The major exporters of the world namely US and Australia have lost their share in the world’s export with the coming of India in the exporting scenario. The export figures of India in 2003-04 were 5 million tons. The major importers of Indian wheat are the southeastern Asian countries and the gulf countries. India was an importer of wheat in the 90s as it the domestic demand was too high but now this situation has been overcame and overturned.

Market influencing factors
  • Weather conditions
  • Government policies and regulations
  • Prices fluctuations of the competitive and substitute products
  • Season of harvesting and peak season
  • Technological improvements
  • Crop size
  • World demand for wheat
Major trading centers of wheat


The major trading centers throughout the globe where wheat is traded are

  • Chicago (CBOT)

  • Canada (Winnipeg Commodity Exchange)

  • Kansas (Kansas City Board of Trade)

  • Missouri

  • Japan

  • Australia

  • Bulgaria (Sofia Commodity Exchange)

  • China

In India, wheat is traded at

  • Amritsar (Punjab)

  • Moga (Punjab)

  • Ludhiana (Punjab)

  • Jalandhar (Punjab)

  • Bhatinda (Punjab)

  • Meerut (Uttar Pradesh)

  • Hathras (Uttar Pradesh)

  • Saharanpur (Uttar Pradesh)

  • Barreily (Uttar Pradesh)

Also, wheat is traded in Indian commodity exchanges namely, National Commodity & Derivatives Exchange ltd, Multi Commodity Exchange of India ltd, National Multi Commodity Exchange of India ltd and Chamber Of Commerce, Hapur

 
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