India’s wheat curbs insufficient; traders demand stock release
India’s wheat prices surge to 8-month high of 28,416 rupees/ton, despite government curbs on traders and processors. Industry officials urge stock releases to meet festival season demand. Delayed sales from state reserves may drive prices up 2-3% more, says Shivaji Roller Flour Mills’ MD Ajay Goyal. Government wheat stocks stand at 25.1 million tons.
India’s curbs on traders and processors are not enough to contain the rise in wheat prices during festival season, and the government needs to release stocks to augment supplies amid import restrictions, industry officials said on Wednesday.
But the curbs failed to bring down prices, which were trading at 28,416 rupees ($339.53) per metric ton in New Delhi, up from 24,000 rupees in April.
The market is awaiting the government to begin auctioning wheat to private players as demand is set to rise next month due to festivals amidst limited supplies, said Ajay Goyal, managing director of Shivaji Roller Flour Mills.
India will celebrate Dussehra in October and Diwali in November, when wheat demand usually rises.
“Wheat prices might go up by another 2-3% if the government pushes the sale to next month,” Goyal said on the sidelines of an industry event.
India initially planned to sell wheat from its state reserves to bulk consumers from July, but this was delayed and there has been no subsequent update on its plans.
Last year the government started selling wheat from its reserves in June, and between June 2023 and March 2024 it sold a record amount of nearly 10 million tons from stocks.
That helped bulk buyers such as flour millers and biscuit makers to secure supplies of the staple at affordable costs.
“Due to limited surplus with the government this year, it is reluctant to release large quantity of its wheat stocks in 2024. It aims to maintain sufficient reserves for the first quarter of 2025,” said a New Delhi based trader with a global trade house.
Wheat stocks in India’s government warehouses on Sept. 1 were 25.1 million tons, down 3.5% from a year ago.
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