In a groundbreaking move, India’s Food Corporation sold 2.84 lakh tonnes of in the latest auction, reaching a total of 42 lakh tonnes through the open market sale scheme since June. With a record 2,420 bidders despite stringent controls, the nation strategically manages wheat prices, projecting potential sales of 90 lakh tonnes by March 2024. The government’s proactive measures, including increased minimum support prices, bidder restrictions, and concessional sales for public welfare, highlight a comprehensive approach to ensure a balanced and controlled wheat market.
Wheat Sales via OMSS: The Food Corporation of India (FCI) has sold a substantial amount of wheat, totaling nearly 42 lakh tonnes, through the open market sale scheme since June 28. This is to regulate domestic prices and ensure market stability.
Auction Details: The recent auction on November 29 saw 2.84 lakh tonnes of wheat being sold at a weighted average price of ₹2,128/quintal, similar to the previous week’s rate. Earlier, the average selling price was higher at ₹2,279/quintal.
Increased Participation: Despite stringent checks to limit participation to processors and exclude traders, a record number of 2,420 bidders engaged in the recent wheat auction, signaling strong market interest.
Price Fluctuations: While there was a drop in average selling price to ₹2,233.61/quintal on November 15 from ₹2,251.79/quintal, rates have shown an upward trend in the past two auction rounds.
Government Actions: To manage wheat prices, the government raised the minimum support price (MSP) for wheat in the upcoming marketing season (April-March). Additionally, they plan to continue OMSS sales until March 31, 2024, aiming to offload 101.5 lakh tonnes of wheat to stabilize prices.
Future Projections: Observations from recent bidder interest suggest the potential for the FCI to sell an additional 48-50 lakh tonnes of wheat by March 31, potentially totaling around 90 lakh tonnes for the year.
Control Measures: The government has implemented various measures to maintain control over wheat sales, such as restricting traders from auctions, increasing bidder quantity caps, and verifying processing plant electricity bills to deter trader involvement.
Concessional Sales: Alongside the OMSS, the government allocated 2.28 lakh tonnes of wheat at concessional rates to cooperative organizations for producing atta (flour) under the ‘Bharat Atta’ brand, aiming to sell it at a maximum retail price of ₹27.50/kg.
India’s dynamic strategies in wheat management, evident in robust sales, heightened bidder interest, and proactive government measures, showcase a well-rounded approach to stabilize prices and maintain market equilibrium. With continued initiatives and a projected 90 lakh tonnes of wheat sales by March 2024, the nation not only meets immediate challenges but lays a foundation for a resilient and sustainable grain market.