Centre offers more wheat from FCI in open market, screws on stockists tightened
The Indian government on Friday announced that more quantity of wheat will be made available from official reserves through weekly auctions with immediate effect. Besides, the stock holding limits for all stakeholders have been further tightened to ensure sufficient availability in the market as it swung into action after the cereal’s arrival dropped by 30 per cent in November from October.
Announcing the decision on Friday, Food Secretary Sanjeev Chopra said the Government has approved further release of 25 lakh tonnes (lt) of wheat over and above 101 lt already allocated under the open market sale scheme (OMSS). He said hopefully, the increased offer in the weekly auction will help prevent any further rise in prices.
The Food Corporation of India (FCI) has so far sold 44.65 lt of wheat through weekly e-auctions under OMSS since it began from June 28.
Arrivals 8.06 lakh tones in Nov
“In a further step to increase supplies in the open market, it has been decided to increase the weekly quantity being offered through e-auction by FCI, from 3 lt to 4 lt with immediate effect,” the Food Ministry said in a statement.
According to Agmarknet portal, the wheat arrival at agriculture market yards (mandis) across the country declined to 8.07 lt in November from 11.17 lt in October. In the first week of the current month’s arrivals have been less than 2 lt. In November 2021, when wheat production was normal, the arrival dipped only 7 per cent from the previous month, which is a normal phenomenon while heading towards the new season.
Further, the government has revised the wheat stock limit, reducing the maximum quantity processors, retailers, wholesalers can keep at any point of time.
‘Conform to orders by Jan 6’
According to the revised notification, 5 tonnes of wheat limit has been fixed for any retail outlet including big chains at retail outlet level, against 10 tonnes earlier. For traders and wholesalers as well as big chain retailers at depot level it has been cut to 1,000 tonnes from 2,000 tonnes. For processors of atta and other flour products like sooji and maida, the maximum capacity will be 70 per cent of monthly installed capacity of the mills multiplied by four, which is the remaining months of 2023-24.
The Food Ministry has asked the stakeholders to conform to the revised prescribed stock limits by January 6 in case the stocks held by any of these entities are higher than the limit. All wheat stocking entities are required to register on the wheat stock limit portal and update the stock position on every Friday.
“In the past four weeks, the all-India average selling price of wheat in FCI tender increased by nearly ₹70/quintal even after the weekly offering was hiked to 3 lt from 2 lt. But, there was a jump of ₹225/quintal in the highest bidding price in Karnataka in a month,” a flour miller said.
In the December 6 auction, the highest price of the successful bidder in Karnataka was ₹2,800/quintal against the highest price of ₹2,575 on November 15, sources said. The all-India average selling price of wheat was ₹2,301.36 on December 6, up from ₹2,233.61 on November 15.
More for Bharat Atta
The Food Ministry said areas where prices are reigning higher have been identified and NCCF and Nafed are undertaking targeted sales in these areas. “The amount wheat to be supplied for Bharat Atta is being further increased from 2.5 lt to 4 lt till January 31, 2024. The allocations to Nafed/NCCF and Kendriya Bhandar are being reviewed periodically to ensure sufficient availability,” it said.
FCI is issuing wheat to Central Co-operative organisations such as Nafed, NCCF and Kendriya Bhandar for processing into atta and for sale under the “Bharat Atta” brand through their physical/mobile outlets, at ₹27.50/kg as part of the government’s measure to check price rise.