This story is from August 10, 2023

To check prices, govt to sell extra wheat & rice stocks

Amid rising prices of wheat and atta (wheat flour), the central government on Wednesday announced that it would sell an additional 50 lakh tonnes of the foodgrain from the Food Corporation of India (FCI) stock to boost availability and contain price rise. The Centre also announced sale of an additional 25 lakh tonnes of rice in the open market, and also a reduction of its reserve price from Rs 31 to Rs 29 per kg.
To check prices, govt to sell extra wheat & rice stocks
NEW DELHI: Amid rising prices of wheat and atta (wheat flour), the central government on Wednesday announced that it would sell an additional 50 lakh tonnes of the foodgrain from the Food Corporation of India (FCI) stock to boost availability and contain price rise. The Centre also announced sale of an additional 25 lakh tonnes of rice in the open market, and also a reduction of its reserve price from Rs 31 to Rs 29 per kg.
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Announcing the decision to offload more wheat and rice, Union food secretary Sanjeev Chopra said, "Prices of two commodities have been in the news for the past couple of months because of the rising trend that we have been noticing."
The government started the weekly sale of wheat under the Open Market Sale Scheme (OMSS) early this year, from June 28, and sale of rice from July 5 to put a check on price rise. So far around 8 lakh tonnes of wheat has been sold by the FCI. So far, the FCI has sold only 2,200 tonnes of rice.
Chopra said the wheat offtake under the OMSS has been good so far. However, the weighted average selling price has been going up in the past two-three auctions.
The data shows that the weighted average selling price of wheat has increased by 5.5% in the past seven weeks - from Rs 2,136 on June 28 to Rs 2,255 per quintal on August 9 (Wednesday). Moreover, the weighted average selling price on Wednesday was nearly 6% more than the FCI's reserve price.
Chopra said the government offering more wheat is likely to compel traders and big farmers, who have been holding on to their stock in anticipation of getting better prices, to release the same. "When we offload more wheat from our stock to increase availability, it's an indication that the prices won't go up. Those holding on to stocks won't get a better price," he said.

FCI chairman and managing director Ashok K Meena said they have 87 lakh tonnes of surplus wheat after meeting the requirement under the food security scheme, and other welfare programmes, signalling that the government has enough grains for market intervention. "We have a surplus of over 200 lakh tonnes of rice as well," he added.
On the traders and millers buying wheat at a higher price than the reserve price, Meena said this trend shows that there is an increase in the market demand for wheat.
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