FCI sells 1.12 MT of wheat in open market since June
By Sandip Das
The Food Corporation of India (FCI) has sold 1.12 million tonne (MT) of wheat from its stocks in the open market through weekly e-auctions which commenced on June 28 while the corporation could sell only 0.1 MT of rice since July 5.
On Wednesday, the corporation sold 0.15 MT of wheat against 0.2 MT offered on the e-auction. In the case of rice only 830 tonne was sold to bulk buyers against 0.32 MT offered for sales.
To contain cereal prices, the government had announced the sale of 5 MT of wheat and 2.5 MT of rice from the central pool in the open market to bulk buyers.
The retail inflation in cereal and products category was reported at 13.04% in July, a decline from 16.12% in January. Inflation in cereals had been in double digits since October last year.
A food ministry official said the FCI will continue to sell foodgrains from its surplus stocks till inflationary trend in cereals prices is curbed. As per earlier policy, the corporation had been selling surplus wheat to bulk buyers during the lean season (January-March).
Currently the FCI has 37 MT of rice which includes 12.43 MT to be received from millers against a buffer of 10.25 MT for October 1. In case of wheat, the central pool stock is around 27.5 MT against a buffer of 20.52 MT for October 1. The official said grain stocks are above the buffer and sufficient to carry out open market sales.
The weighted average of the selling price of wheat declined to Rs 2152/quintal on the e-auction held on Wednesday from Rs 2,254/quintal from the e-auction held a fortnight back.
In the case of rice, despite a Rs 2/kg reduction in the base price of rice to Rs 29/kg against economic cost of more than Rs 36/kg, there has been sluggish interest by traders in the open market sale. The weighted average of the selling price of rice declined to Rs 3023/quintal from Rs 3163/quintal from the e-auction on August 9.
To curb inflation in rice, the government last week had imposed a ban on export of non-basmati white rice with immediate effect.The FCI has also stopped providing rice to distilleries for ethanol manufacturing.
The government had imposed stock holding limits on wheat for the first time since 2008 for traders, wholesalers and retailers till March 31, 2024 last month to control increase in prices.
This article has been republished from The Financial Express