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India bans wheat exports as heat wave hurts crop, domestic prices soar

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© Reuters. FILE PHOTO: A combine deposits harvested wheat in a tractor trolley at a field on the outskirts of Ahmedabad, India, March 16, 2022. REUTERS/Amit Dave

By Rajendra Jadhav, Mayank Bhardwaj and Nigam Prusty

MUMBAI (Reuters) -India banned wheat exports on Saturday days after saying it was targeting record shipments this year, as a scorching heat wave curtailed output and domestic prices hit a record high.

The government said it would still allow exports backed by already issued letters of credit and to countries that request supplies “to meet their food security needs”.

The move to ban overseas shipments was not in perpetuity and could be revised, senior government officials told a press conference.

Global buyers were banking on supplies from the world’s second-biggest wheat producer after exports from the Black Sea region plunged following Russia’s Feb. 24 invasion of Ukraine. Before the ban, India had aimed to ship a record 10 million tonnes this year.

The officials added that there was no dramatic fall in wheat output this year, but unregulated exports had led to a rise in local prices.

“We don’t want wheat trade to happen in an unregulated manner or hoarding to happen,” commerce secretary BVR Subrahmanyam told reporters in New Delhi.

Although not one of the world’s top wheat exporters, India’s ban could drive global prices to new peaks given already tight supply, hitting poor consumers in Asia and Africa particularly hard.

“The ban is shocking,” a Mumbai-based dealer with a global trading firm said. “We were expecting curbs on exports after two to three months, but it seems like the inflation numbers changed the government’s mind.”

Rising food and energy prices pushed India’s annual retail inflation near an eight-year high in April, strengthening expectations that the central bank would raise interest rates more aggressively.

Wheat prices in India have risen to record highs, in some spot markets hitting 25,000 rupees ($320) per tonne, well above the government’s minimum support price of 20,150 rupees.

Rising fuel, labour, transportation and packaging costs are also boosting the price of wheat flour in India.

“It was not wheat alone. The rise in overall prices raised concerns about inflation and that’s why the government had to ban wheat exports,” said another senior government official who asked not to be named as discussions about export curbs were private. “For us, it’s abundance of caution.”

SMALLER CROP

India this week outlined its record export target for the fiscal year that started on April 1, saying it would send trade delegations to countries such as Morocco, Tunisia, Indonesia and the Philippines to explore ways to boost shipments.

In February, the government forecast production of 111.32 million tonnes, the sixth straight record crop, but it cut the forecast to 105 million tonnes in May.

A spike in temperatures in mid-March means the crop could instead be around 100 million tonnes or even lower, said a New Delhi-based dealer with a global trading firm.

“The government’s procurement has fallen more than 50%. Spot markets are getting far lower supplies than last year. All these things are indicating lower crop,” the dealer said.

Cashing in on a rally in global wheat prices after Russia invaded Ukraine, India exported a record 7 million tonnes of wheat in the fiscal year to March, up more than 250% from the previous year.

“The rise in wheat price was rather moderate, and Indian prices are still substantially lower than global prices,” said Rajesh Paharia Jain, a New Delhi-based trader.

“Wheat prices in some parts of the country had jumped to the current level even last year, so the move to ban export is nothing but a knee-jerk reaction.”

Despite a drop in production and government purchases by the state-run Food Corporation of India (FCI), India could have shipped at least 10 million tonnes of wheat this fiscal year, Jain said.

The FCI has so far bought a little over 19 million tonnes of wheat from domestic farmers, against last year’s total purchases of a record 43.34 million tonnes. It buys grain from local farmers to run a food welfare programme for the poor.

Unlike previous years, farmers have preferred to sell wheat to private traders, who offered better prices than the government’s fixed rate.

In April, India exported a record 1.4 million tonnes of wheat and deals were already signed to export around 1.5 million tonnes in May.

“The Indian ban will lift global wheat prices. Right now there is no big supplier in the market,” another dealer said.

($1 = 77.4700 Indian rupees)

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U.S. to allow baby formula imports amid nationwide shortage

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© Reuters. FILE PHOTO: Empty shelves show a shortage of baby formula at CVS in San Antonio, Texas, U.S. May 10, 2022. REUTERS/Kaylee Greenlee Beal/File Photo

By Ahmed Aboulenein and Eric Beech

WASHINGTON (Reuters) -The United States will allow baby formula imports from foreign makers that do not usually sell their products here, the Food and Drug Administration said on Monday, as it tries to ease a nationwide shortage that has left parents scrambling to feed their babies.

The temporary move could help put more formula onto U.S. shelves in a few weeks, a U.S. FDA official said during a news briefing. Foreign makers will need to meet a list of safety and nutritional standards provided by the FDA.

U.S. baby formula has been in low stock after a February recall of baby powder formula and plant closure by one of the nation’s main manufacturers, Abbott Laboratories (NYSE:ABT). The FDA was investigating after reports that four babies who had been fed formula made there became ill from Cronobacter sakazakii infections.

The FDA and Abbott agreed on Monday on the steps needed to reopen the plant, which an FDA official said could happen in the near term. The company said it would restart the plant within two weeks after the FDA confirms it has met these requirements.

In its investigation, the FDA found bacteria contamination in environmental samples taken at the site and noted problems such as standing water and improper sanitization of footwear.

Abbott said in a statement that there is no conclusive evidence to link Abbott’s formulas to these infant illnesses. It also said the investigation found no contamination in finished product.

“We have been working to address the FDA’s observations so we can restart operations,” the company said in a statement on Monday.

The shortage of Abbott formula has been compounded by supply-chain snags and historic inflation, leaving about 40% of baby formula products out of stock nationwide, data shows.

“We know many parents and caregivers are feeling frustrated by their inability to access needed or desired infant formula and critical medical foods. Please know that we at the FDA are doing everything in our power to address these challenges as quickly as possible,” FDA Commissioner Robert Califf said.

He encouraged formula makers to increase their supply and the FDA said some including Gerber, part of Nestle SA (SIX:NESN), and Reckitt Benckiser Group Plc (LON:RKT) had already done so.

FDA officials said during the briefing that the agency’s ability to determine a causal link between the consumption of the product from the plant and the four cases of bacterial infections was hindered by the fact that it only had genetic sequences available on two of the infections.

Abbott has shipped to the United States millions of cans of formula from its FDA-approved Ireland facility.

The White House separately said it was continuing talks with the major formula manufacturers to identify logistical hurdles and provide any transportation support that could help them and major retailers get formula to where it is needed.

“This is principally an issue of production more than goods movement,” Transportation Secretary Pete Buttigieg told reporters at a White House briefing.

A White House official earlier said the government has offered transportation and logistics support to Abbott as well as Reckitt Benckiser, Nestle and Perrigo Co (NYSE:PRGO) Plc, in addition to top retailers such as Target Corp (NYSE:TGT), Amazon.com Inc (NASDAQ:AMZN) and Walmart (NYSE:WMT) Inc.

Congress this week also plans to address infant formula rules regarding the Women, Infants and Children program, a federal assistance nutrition program administered by U.S. states, as well as emergency funding to shore up supplies.

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Ukrainian troops evacuate from Mariupol, ceding control to Russia

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6/6

© Reuters. A bus carrying wounded service members of Ukrainian forces from the besieged Azovstal steel mill in Mariupol drives under escort of the pro-Russian military in the course of Ukraine-Russia conflict upon arrival in Novoazovsk, Ukraine May 16, 2022. REUTERS

2/6

By Natalia Zinets

KYIV/NOVOAZOVSK, Ukraine (Reuters) – Ukraine’s military said on Tuesday it was working to evacuate all remaining troops from their last stronghold in the besieged port of Mariupol, ceding control of the city to Russia after months of bombardment.

The evacuation likely marked the end of the longest and bloodiest battle of the Ukraine war and a significant defeat for Ukraine. Mariupol is now in ruins after a Russian siege that Ukraine says killed tens of thousands of people in the city.

With the rest of Mariupol firmly in Russian hands, hundreds of Ukrainian troops and civilians had holed up beneath the city’s Azovstal steelworks. Civilians inside were evacuated in recent weeks, and more than 260 troops, some of them wounded, left the plant for Russian-controlled areas late on Monday.

“The ‘Mariupol’ garrison has fulfilled its combat mission,” the General Staff of Ukraine’s Armed Forces said in a statement announcing evacuations.

“The supreme military command ordered the commanders of the units stationed at Azovstal to save the lives of the personnel… Defenders of Mariupol are the heroes of our time,” it added.

Ukraine’s deputy defence minister said 53 injured troops from the Azovstal steelworks were taken to a hospital in the Russian-controlled town of Novoazovsk, some 32 kilometres (20 miles) to the east.

Another 211 people were taken to the town of Olenivka, in an area controlled by Russian-backed separatists, Deputy Defence Minister Anna Malyar said. All of the evacuees will be subject to a potential prisoner exchange with Russia, she added.

It was not clear how many troops remained in Azovstal. Ukraine’s military said efforts were under way to evacuate those still inside.

Reuters saw five buses carrying troops from Azovstal arrive in Novoazovsk late on Monday. Some of the evacuated troops were wounded and carried out of the buses on stretchers. Some 600 troops were believed to have been inside the steel plant.

“We hope that we will be able to save the lives of our guys,” Ukraine President Volodymyr Zelenskiy said in an early morning address. “There are severely wounded ones among them. They’re receiving care. Ukraine needs Ukrainian heroes alive.”

Arriving in Novoazovsk in a bus marked with Z, a symbol for Russia’s invasion, men could be seen stacked on stretchers on three levels. They stared out the windows without reacting. One man was wheeled out, his head tightly wrapped in thick bandages.

Since Russia launched its invasion in February, Mariupol’s devastation has become a symbol both of Ukraine’s resistance and of Russia’s willingness to devastate Ukrainian cities that hold out.

The first evacuations late on Monday came hours after Russia said it had agreed to evacuate wounded Ukrainian soldiers to a medical facility in Novoazovsk.

LVIV EXPLOSIONS, KHARKIV FIGHTING

Moscow calls its nearly three-month-old invasion a “special military operation” to rid Ukraine of fascists, an assertion Kyiv and its Western allies say is a baseless pretext for an unprovoked war.

Russia’s invading forces have run into apparent setbacks, with troops forced out of the north and the environs of Kyiv in late March. A Ukrainian counterattack in recent days has driven Russian forces out of the area near Kharkiv, the biggest city in the east.

Areas around Kyiv and the western city of Lviv, near the Polish border, have continued to come under Russian attack. A series of explosions struck Lviv early on Tuesday, a Reuters witness said. There were no immediate reports of casualties or damage.

On Monday, Ukraine’s defence ministry troops had advanced all the way to the Russian border, about 40 km north of Kharkiv.

The successes near Kharkiv could let Ukraine attack supply lines for Russia’s main offensive, grinding on further south in the Donbas region, where Moscow has been launching mass assaults for a month yet achieving only small gains.

PUTIN CLIMBDOWN OVER NATO

Russian President Vladimir Putin appeared on Monday to climb down from threats to retaliate against Sweden and Finland for announcing plans to join the U.S.-led NATO military alliance.

“As far as expansion goes, including new members Finland and Sweden, Russia has no problems with these states – none. And so in this sense there is no immediate threat to Russia from an expansion to include these countries,” Putin said.

The comments appeared to mark a major shift in rhetoric, after years of casting NATO enlargement as a direct threat to Russia’s security, including citing it as a justification for the invasion of Ukraine itself.

Soon before Putin spoke, Russia’s deputy foreign minister, Sergei Ryabkov, said Finland and Sweden were making a mistake that would have far-reaching consequences: “They should have no illusions that we will simply put up with it.”

Putin said NATO enlargement was being used by the United States in an “aggressive” way to aggravate an already difficult global security situation, and that Russia would respond if the alliance moves weapons or troops forward.

“The expansion of military infrastructure into this territory would certainly provoke our response. What that (response) will be – we will see what threats are created for us,” Putin said.

Finland and Sweden, both non-aligned throughout the Cold War, say they now want the protection offered by NATO’s treaty, under which an attack on any member is an attack on all.

“We are leaving one era behind us and entering a new one,” Swedish Prime Minister Magdalena Andersson said, announcing plans to formally abandon militarily non-aligned status – a cornerstone of national identity for more than 200 years.

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U.S. Air force says it conducted successful hypersonic weapon test

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WASHINGTON (Reuters) – The U.S. Air Force said on Monday it had conducted a successful test of a hypersonic weapon, which flew at five times the speed of sound.

The test was conducted on Saturday off the coast of Southern California when a B-52 bomber released an Air-launched Rapid Response Weapon, the Air Force said in a statement.

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