Indian millers bid higher rates to get FCI’s wheat, offtake 100% in many States
Wheat prices rose in most states during FCI’s October 28 OMSS auction as supplies tightened and weekly allocation was cut by 5,000 tonnes to 1.01 lakh tonnes. Millers urged higher releases, citing FCI stocks of 463 lakh tonnes, while wheat production reached a record 120.66 million tonnes.
A large number of buyers bid for wheat at a higher price in this week’s Food Corporation of India (FCI) open market sales scheme (OMSS) auctions, designed to check prices of rice and wheat in the open market.
This comes amid tightening of supplies and also the maximum quantity that can be lifted. Except Haryana, the average selling price of wheat in the weekly auction held on October 28 was higher in most of the States compared with the previous week.
The government had reduced the overall wheat allocation for sales in the weekly auction held on October 28, by 5,000 tonnes to 1.01 lakh tonnes (lt) from the previous tender, even as processors and millers scrambled to buy the grain at over ₹3,100/quintal in many States when the all-India average wholesale price was ruled ₹2,910/quintal.
Above buffer norms
Experts said that a lower quantity made available in the auction is one factor for prices to rise, while the second factor is the capping of maximum quantity for each bidder.
“When an average flour mill requires at least 3,000 tonnes a month to run its facility, by keeping a cap of 300 tonnes, the government is not providing even half of their monthly requirement,” said an industry expert, adding the government should release more as the current stock with FCI is over 463 lakh tonnes (as on October 1).
The buffer norm prescribes minimum of 205.2 lt of wheat should be in the official reserve on October 1 any year. The government had about 320 lt of wheat as of October 1, 2025.
Millers said that they are now dependent on FCI since market arrival has dwindled despite stock declaration imposed by the government, which is aware of how much stock lies with whom.
Record production
In Punjab, which got the maximum allocation of 25,000 tonnes, the entire quantity was intended to be lifted in the auction where processors/millers offered to buy wheat between ₹3200/quintal and ₹2,830/quintal.
Only six bidders quoted below ₹2,900/quintal out of 203. However, the average selling price was ₹2,992/quintal against ₹2,982/quintal in previous week.
The offered quantity in a single depot should be decided based on the concentration of mills in the surrounding areas rather than putting a maximum cap of 500 tonnes per week, Naresh Ghai, President of Roller Flour Mills Association of Punjab said, demanding the weekly auction have minimum 40,000 tonnes.
The government procured 357.57 lt of wheat in the 2026-27 season against 299.75 lt in the previous marketing season (RMS 2025-26). India’s wheat production in the 2025-26 crop year rose to record 120.66 million tonnes (mt) from 117.95 mt in the previous year.
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Source : The Hindu Businessline
