Wheat prices fall by Rs 5/kg after launch of open mkt sale
Prices of wheat in wholesale and retail markets have come down by about Rs 5 per kg after the Centre's decision to sell 3 million tonnes of the grain in the open market
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Prices of wheat in wholesale and retail markets have come down by about Rs 5 per kg after the Centre's decision to sell 3 million tonnes of the grain in the open market.
More steps will be taken if required to ease rates, Union Food Secretary Sanjeev Chopra has said.
The government is closely monitoring the prices of wheat and atta (wheat flour) and, if needed, will take more steps, including offering more wheat under the Open Market Sale Scheme (OMSS), to bring down the prices and provide relief to consumers, Chopra said.
He said the government is not considering any proposal as of now to lift the ban on wheat exports, which was imposed in May last year after a sharp fall in its procurement.
"From the time the OMSS was announced in January, wheat prices have come down. Wheat prices in wholesale markets are ruling less than Rs 2,500 per quintal," he said, and hoped that the prices would fall further in the coming days.
The government of India is very very concerned and monitoring the situation very closely," he said.
"Whatever further steps need to be taken in terms of bringing down the prices we will take," Chopra said.
The options include increasing the quantities under the OMSS from the current 3 million tonnes and also reducing the reserve price.
The food secretary said that the wholesale prices have fallen to around Rs 2,500 from Rs 3,000 per quintal, while retail prices have eased to Rs 2,800-2,900 per quintal from Rs 3,300-3400 per quintal.
Last month, the government announced plans to sell 30 lakh (3 million) tonnes of wheat in the open market from its buffer stock under the OMSS, in order to check rising wheat and wheat flour prices.
Out of the 30 lakh tonnes, Food Corporation of India (FCI) will sell 25 lakh (2.5 million) tonnes to bulk consumers like flour millers through e-auction and 2 lakh tonnes will be given to states/union territories. 3 lakh tonnes of wheat are being provided to institutions and state-PSUs at a concession for converting wheat into wheat flour.
Chopra said the second round of auction of wheat for 1.5 million tonnes is happening on Wednesday across the country.
He highlighted that the government has recently reduced prices to 21.50 per kg from Rs 23.50 for institutions like NAFED and Kendriya Bhandar for converting into atta and selling to consumers at Rs 27.50 per kg, as against the earlier rate of Rs 29.50 per kg.
Under the OMSS, the Centre had last week decided to do away with freight charges and sell the grain at a reserve price of Rs 2,350 per quintal to bulk users pan India through e-auction.
The states are allowed to purchase wheat from FCI for their own schemes at above reserve prices without participating in e-auction.
FCI has already sold 9.26 lakh tonnes of wheat out of 25 lakh tonnes to traders, flour mills etc in the course of the first e-auction held during February 1-2. The next auction will be held on February 15.
FCI, the government's nodal agency for procurement and distribution of foodgrains, had around 156.96 lakh tonnes of wheat as of January 26 in the buffer stock.
On April 1, the country would have a wheat stock of 96 lakh tonnes, just above the buffer norm requirement of 75 lakh tonnes.
The Centre had banned wheat exports in May last year to control prices, after a slight fall in domestic production and a sharp decline in the FCI's procurement for the central pool.
India's wheat production fell to 107.74 million tonnes in the 2021-22 crop year (July-June) from 109.59 million tonnes in the previous year due to heat waves in a few states. The procurement fell sharply to 19 million tonnes this year from around 43 million tonnes last year.
The area under coverage for wheat crops in the current rabi (winter-sown) season is slightly higher.
On Tuesday, the Agriculture Ministry predicted that wheat production may rise to record 112.18 million tonnes in the current 2022-23 crop year. The procurement of wheat will start in full swing from April.
