India's rice and sugar exports could get a boost with the end of war in Iraq but the country is likely to be edged out by the United States and Australia in wheat sales, industry officials said on Tuesday.

But they said it was too early to quantify the market as the new establishment in Baghdad was yet to take shape.

"The Iraqi market was closed for our rice for political reasons," said Anil Aggarwal, an official of the industry-sponsored India-Iraq Joint Business Council.

"But now that things have changed and we have very competitive prices, there is good scope for business."

Iraq imported 1.2 million tonnes of rice in 2002, mainly from traditional exporters like Thailand, Vietnam and Pakistan.

"We will have some cost advantage as the freight from India will be lower," an analyst said.

Thai 25 percent broken grade is currently offered around $172 a tonne FOB, Vietnam at $160 a tonne while Indian rice of a similar variety is priced around $156.

India, sitting on 40 million tonnes of grains and 10 million tonnes of sugar, is trying to cut its stocks by subsidising exports.

"Indian sugar has good prospects, we were already supplying them (Iraq) through some other countries, now we can send directly since it will be a much more transparent market," said S L Jain, managing director of Indian Sugar Mills Association.

Industry officials said India, the world's second largest sugar producer, was selling around 75,000 tonnes of the sweetener to Iraq each year, most of it through other countries or international agencies.

"Exports will definitely grow from our current level," a leading exporter said.

Iraq annually imports around 600,000 tonnes of sugar.

Traders said India was likely to lose its share of wheat sales to Iraq.

"US will definitely try and move its own wheat and help its coalition partners," Aggarwal said.

Australia, which sells up to two million tonnes of wheat worth $490 million to Iraq, is keen to protect its commercial interests and is sending a team of agricultural experts to the country to rebuild the farm sector.

Indian traders said they were unsure about the fate of 600,000 tonnes of wheat contracts signed with Iraq. "We are worried, it is a big question whether existing contracts get fulfilled or not," Aggarwal said.

Indian firms won contracts in 2001 to supply 600,000 tonnes of wheat under the UN-backed oil-for-food programme but Baghdad rejected shipments on quality grounds.

Indian traders then set up cleaning facilities at various ports and the first successful delivery since then was by New Delhi-based Priyanka Overseas Ltd, which sent 22,000 tonnes of wheat to Umm Qasr in February.

Priyanka said two of its vessels - 17,800 tonnes of wheat and 13,000 tonnes of sugar - meant for Iraq were currently being discharged in Dubai.

Priyanka Managing Director R K Jain said he was hopeful of more wheat sales to Iraq because the United Nations was actively buying food for the country.

"United States is concentrating on reconstruction and oil, and for the next six months I see U.N. aid agencies buying food from India and other countries," he said.