The government will sell rice and wheat on the open market to control prices

The government will soon sell 4 lakh tonnes of wheat and 5 lakh tonnes of rice from buffer stock to bulk buyers and dealers in the first round of auctions, despite the growing retail prices of commodities. These steps are a part of the Center’s comprehensive effort to reduce the rate of increase in the retail price of these two popular grains. To increase domestic supplies and manage prices, the Food Corporation of India (FCI), the government’s central agency for the purchase and distribution of foodgrains, will hold an online auction for wheat on June 28 and one for rice on July 5. Soon, the bids will be floated.

“Retail prices for wheat and rice have been on the rise recently. We are required by the government to launch the Open Market Sale Scheme (OMMSS). The goal is to lower retail pricing, said Ashok K. Meena, chairman and managing director of FCI, in a statement to PTI. In an effort to prevent hoarding and stem the rise in prices, the government placed immediate stock limitations on wheat on June 12. These limits will remain in place through March 2024. It also resolved to sell 15 lakh tonnes of wheat from the central pool managed by the OMSS to dealers and large users.

The Centre had made the decision to sell rice to large purchasers through the OMSS but had not given an exact quantity. “We are releasing the wheat tender tonight (Friday), and the first round of the 4 lakh tonnes of wheat auction will take place on June 28. On July 5, 5 lakh tonnes of rice will be put up for auction, he said. The reserve price for wheat has been set at Rs. 2,150 per quintal for grains of Fair and Average Quality (FAQ) and Rs. 2,125 per quintal for grain produced in accordance with more relaxed standards (URS).

A reserve price of Rs 3100 per quintal of rice has been established. The stock limit on wheat was put in place, according to Union Food Secretary Sanjeev Chopra, on June 12. He said that this was because “unscrupulous elements are holding the stock and creating artificial scarcity,” which has caused mandi prices to rise by almost 8% over the previous month. Prices at the wholesale and retail levels have not increased significantly.

As modal mandi prices are indicating an uptrend, we anticipate that with the lag, both wholesale and retail prices would increase. He remarked, “The government has set a cap on wheat stock. On June 7, wheat prices in Mandi increased to Rs 2,302 per quintal from Rs 2,129 per quintal the previous month. The limit on stock holding for wheat merchants and wholesalers is 3,000 tonnes, with 10 tonnes for retailers, 10 tonnes for each location of a large chain store, and 3,000 tonnes for all of their depots. 75% of the installed yearly capacity for processors.

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