Govt open market wheat sales at record 8.48 MT; target sales 10 MT of grain by next month to cool down prices
The government’s open market sale scheme (OMSS) of wheat from the Food Corporation of India (FCI) stock on Wednesday crossed a record 8.48 million tonne (MT), with a highest sale of 0.48 MT in the weekly e-auction for bulk buyers.
To curb spike prices, the government is aiming to sell a record 10 MT of wheat by March 15 this fiscal, since e-auction for the bulk buyers commenced in June.
The highest quantity of wheat sold was 8.1 MT in 2018-19 for bulk buyers such as flour millers.
At present, FCI has a wheat stock of 11.93 MT, lowest since 2016.
According to an assessment, following the offloading of 10 MT of wheat in the market, the government stock is likely to fall to around 7.7 – 7.8 MT by April 1, against a buffer of 7.4 MT.
As per an earlier policy, the corporation had been selling surplus wheat to bulk buyers like flour millers only during the lean season (January-March).
The wheat was sold in Wednesday’s auction at an average price of Rs 2236/quintal against the reserve prices of Rs 2129/quintal, under the open market sale.
The price realised is just above the current season’s minimum support price (MSP) of Rs 2125/quintal.
Overall cereals inflation last month dropped to 7.83% from 9.93% on year in December, 2023 because of some softening of wheat prices.
Inflation in wheat declined further to 2.33% in January from 4.69% in December on year because of improvement in supplies due to open market sale being carried out by the FCI.
Procurement of wheat for the 2024-25 marketing season (April-June) would commence on April 1.
Meanwhile, the food ministry has stated that 0.27 MT flour has been sold under the Bharat Atta initiative.
Under Bharat Atta initiative, FCI has allocated 0.4 MT of wheat to Kendriya Bhandar, farmers’ cooperatives Nafed and National Cooperative Consumers Federation (NCCF) for converting into ‘Bharat Atta’, which is being sold to consumers at Rs 27.5/Kg.
According to a food ministry note, retail prices of wheat declined marginally by 1.58% to Rs 31.09/kg on Wednesday on year. However, retail prices of rice rose by 13.59% to Rs 43.96/kg on Wednesday.
“The open market sale of wheat has helped in stabilising prices,” Ashok Kumar Meena, chairman and managing director, FCI had stated.
The government recently launched the Bharat rice initiative, under which it sells subsidised rice at Rs 29/kg.
The ministry said that the domestic prices of rice are at elevated levels despite a record output, ample stocks with FCI in the pipeline and various restrictions and duties imposed on grain exports. FCI has sold only 0.17 MT of rice in the market so far under OMSS.
Source Link: https://www.financialexpress.com/policy/economy-govt-open-market-wheat-sales-at-record-8-48-mt-target-sales-10-mt-of-grain-by-next-month-to-cool-down-prices-3394748/
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