Wheat Prices Correct Amid Procurement Slowdown and Cautious Buyer Sentiment

New Delhi, May 6 (CommoditiesControl): Following an early rise in the previous week, wheat prices experienced a correction across major centers today, as buyers adopted a cautious approach towards purchasing at higher rates amid uncertainty surrounding demand for processed wheat products. Typically, during May, the offtake of processed wheat products tends to be relatively sluggish due to declining human consumption amid rising temperatures.

Despite witnessing an increase of around Rs 60-80 per quintal in recent weeks, wheat prices corrected by Rs 20-30 per quintal across major centers in India. In Uttar Pradesh (UP), strict directives from government officials for stockists have made traders cautious. However, most sellers remain reluctant to sell at lower rates.

In Punjab, decreasing arrivals have supported prices at lower rates. The daily arrival of wheat in Punjab and Haryana mandis for the ongoing procurement season has declined after reaching a peak last week. Haryana's procurement pace has significantly slowed, with expectations that procurement may conclude at 6.6 million tons in the next 3-4 days, falling short of the conservative target of 30 million tons by 2-3 million tons.

In terms of regional pricing:
- Delhi prices traded down by Rs 10 per quintal at Rs 2480 per quintal.
- Rajasthan new wheat traded steady at Rs 2570 per quintal due to good demand.
- Gujarat new wheat also traded steady at Rs 2570 per quintal.
- Bengaluru prices remained steady at Rs 2840-50 per quintal (net), while Madhya Pradesh wheat traded up by Rs 10 per quintal at Rs 2550-60 per quintal ex warehouse.
- Uttar Pradesh traded down by Rs 30 per quintal at Rs 2410-20 per quintal.

Amidst government actions such as the reduction in import duty on Chana, caution prevails among wheat participants regarding the possibility of similar measures for wheat. Currently, imported wheat (without duty) from Ukraine/Russia is quoted at around USD 310 (Rs 25,730) per MT at Indian ports.

However, despite the potential reduction in import duty, a sharp decline in wheat prices may be challenging given the current global wheat supply scenario and favorable weather conditions in Russia. Conversely, if import duty is removed, a sharp rise in Indian wheat prices may also be unlikely, considering current imported quotes.