Of the 15.25 lt of wheat available for sale in the open market by the Food Corporation of India (FCI), 3.85 lt had already been sold. This is 25% of the offer in the February 15th electronic auction’s second round. The second round’s weighted average price was 2,338.01/quintal, according to a statement released by the Food Ministry on Thursday.
In the first round, the average realized price was $2,474. Last week, the government announced a reduction in the reserve price of wheat by setting the fair average quality (FAQ) category at 23.50/kg and the URS category at 23.50/kg nationwide.
The early arrivals of the fresh harvest are what are being blamed by traders for the decline in offtake, which went from 42% in the first round to 25% in the second. In contrast to the first round, which saw over 1,150 bidders, the second round of the auction saw up to 1,060 traders and millers participate. The government anticipated a drop of at least 2/kg from the sale price for cooperatives. But, since the weighted average in the current auction has decreased by 1.36/kg compared to the first round, the government may be able to lower the costs even further with some additional action, according to a former chairman of the FCI.
Whole wheat must be processed into atta and sold for an MRP of $27.50 per kilogramme in order for this discounted rate to be used. Prior to this, the maximum price for atta per kilogramme was 29.50. Over $25 per kilogramme is the economic price. According to the Ministry, the second round of the e-auction had the highest demand for 100499 tonnes, followed by 5001,000 tonnes and 50100 tonnes. This shows that small and medium-sized wheat millers and dealers took an active part in the sale.
For the maximum quantity of 3,000 tonnes at once, only five bids were submitted. The government has determined that FCI will sell wheat by e-auction nationwide every Wednesday through the second week of March in order to address the rising cost of wheat and atta. The government has offered 5 lt to States, cooperatives, and small dealers to lift wheat at reserve rates without taking part in the electronic auction in addition to the 25 lt set aside for it. The lifting of 68,000 tonnes, 1 lb of NAFED, and 1.32 lb of Kendriya Bhandar has been authorised by the National Cooperative Consumers’ Federation of India Ltd (NCCF).