Weekly Review: Wheat

14-Dec-2024 07:44 PM

Sale of Government Stock Has No Effect on Wholesale Market Price

New Delhi: Despite the Food Corporation of India (FCI) starting a weekly sale of wheat from the central pool under the Open Market Sale Scheme (OMSS) on December 4, with around 2 lakh tonnes sold to millers and processors at discounted prices, there has been no significant impact on the wholesale market price. During the week of December 7 to 13, the price of wheat in major producing states either remained stable or increased.

Market Price Trends:

  • Delhi: Wheat prices from Uttar Pradesh and Rajasthan increased by Rs 50, reaching Rs 3080-3090 per quintal.
  • Rajkot (Gujarat): Wheat prices rose by Rs 100.
  • Indore (Madhya Pradesh): Wheat prices saw a Rs 30 increase.
  • Bhopal, Itarsi, and Dabra (Madhya Pradesh): Prices rose by Rs 100, Rs 45, and Rs 20 per quintal, respectively.
  • Kota (Rajasthan): Wheat prices softened by Rs 20, with prices ranging from Rs 2775 to Rs 2880 per quintal, while some markets in Uttar Pradesh saw price increases.

Quota and Sales Continuation: The government has decided to continue wheat sales under OMSS until March 31, 2025, with an allocated quota of 25 lakh tonnes for this period. There is limited arrival of wheat in major mandis, and millers, processors, and traders are showing strong interest in purchasing wheat from the government stock.

Wheat Sowing and Production Outlook:

  • Wheat sowing is ongoing in major producing states; however, there are signs of a reduction in the sown area in Punjab, Haryana, and Rajasthan due to less-than-ideal weather conditions.
  • While there were expectations of a significant increase in the wheat sowing area due to high market prices, the current situation suggests that the total sown area may shrink to approximately the normal average of 312 lakh hectares.

Stock Situation: The government has limited wheat stock remaining, and farmers are also not holding large quantities. Given this, there is little likelihood of downward pressure on market prices in the near term.

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