Weekly Review-Wheat

01-Feb-2025 08:11 PM

Wheat prices fell due to reduced buying at high prices

This week's review indicates a noticeable drop in wheat prices across various regions due to weaker demand and increased selling pressure. The price reduction has been driven largely by stockists offloading wheat for profit booking, as well as low buying interest from millers and processors.

• Price Movements: In Delhi, wheat from UP and Rajasthan fell by around Rs 220, dropping to Rs 3050-3060 per quintal, while wheat from Madhya Pradesh (MP) in Indore saw a steeper drop of Rs 315, falling to Rs 2700-3000 per quintal. Other regions in Madhya Pradesh like Dewas, Dabra, and Bhopal also saw a price dip of Rs 100-200 per quintal. Similarly, wheat prices in Rajasthan and Uttar Pradesh also softened.

• Open Market Sale Scheme (OMSS): The government has increased the quantity of wheat being sold under the OMSS, offering 1.50 lakh tonnes per week to millers and processors. The total wheat sale quota for the current season has been raised from 25 lakh tonnes to 30 lakh tonnes, indicating an effort to manage stock levels in the market.

• Sowing and Crop Outlook: Wheat sowing has been completed across 324 lakh hectares, with the crop condition being satisfactory so far. Early-sown wheat may start to be harvested in March, and a higher pace of supply is expected from April. The market is likely seeing some stockists looking to offload older stock to make room for the new crop. Despite the decline in prices, the current wholesale price remains higher than the minimum support price (MSP) of Rs 2425 per quintal for the 2024-25 season.

This week’s trend suggests that the market is adjusting to the seasonal dynamics, with stockists clearing older stock while waiting for the new harvest. The steady demand for wheat, combined with the increased OMSS offer, could help maintain balance in the market.

What do you think about the current price trends? Do you see this shift continuing into the next month?