Traders oppose ‘early’ stock limits on wheat

By Sandip Das

The processors and traders of wheat have flayed  the government’s move to impose stock holding limits for the grain despite a robust production and procurement. 

“We were not expecting stock holding limits so early as this year there is record output and the government’s procurement has been quite significant,” Navneet Chitlangia, president, Roller Flour Millers Federation of India, told FE.

Several traders said harvesting of crops has just completed and procurement of wheat is being undertaken by the government agencies in Rajasthan and Uttar Pradesh while there are sufficient supplies in the market.

“Traders and stockists buy wheat keeping into consideration supplies for the next 10 months as the new crop will be harvested only by April next year,” a trader said by adding that imposition of stock holding limits on the grain is a bit premature, could have deferred till the coming festive months. 

The wheat output for the 2024-25 crop year (July-June) is estimated at a a record 117.5 million tonne (MT), higher by 3.7% compared to previous crop year as per the third advance estimate of foodgrain production released by the agriculture ministry.

The food ministry has stated the Food Corporation of India and state government agencies in the 2025-26 rabi marketing season (April-June) have purchased 29.81 MT of wheat from the farmers which is sufficient to meet requirements of public distribution system, welfare schemes and other market intervention schemes such as open market sale scheme.

The procurement so far is 12% higher than the previous year.

Inflation in wheat last month was 7.61% on year and rise in the prices in the domestic market in commensurate with 7% rise in the minimum support price (MSP) to Rs 2425/quintal in the current marketing season.

Under the stock holding limits imposed till March, 31, 2026, traders and wholesalers can stock up to 3,000 tonnes of wheat, while retailers are limited to 10 tonnes for each retail outlet.

The food ministry has stated the agencies will enforce these stock limits to ensure that ‘no artificial scarcity of wheat is created in the country

Big chain retailers can hold up to 10 tonne per outlet, while processors are permitted to stock 70% of their monthly installed capacity multiplied by the remaining months of 2025-26.

All stakeholders such as processors, traders and stockists have been asked to ensure that wheat stock is regularly declared and updated on the portal of the food ministry.

Entities have been asked to bring it to the notice of the food ministry in case of higher stocks. 

“The department of food and public distribution is maintaining a close watch over the stock position of wheat to control prices and ensure easy availability in the country,” according to an official note.

This article has been republished from The Financial Express.