Wheat Prices Steady to Weak Amid Speculations of Lower OMSS Reserves

Mumbai, March 19 (Commoditiescontrol): Wheat prices are reported to be steady to weak in the market discussions, primarily influenced by speculations regarding the Food Corporation of India (FCI) keeping a relatively lower Open Market Sale Scheme (OMSS) reserve for the upcoming months, leading to pressured sentiments.

Recent weather conditions in Madhya Pradesh and Rajasthan have caused some delay in wheat arrivals over the past two weeks. However, crop conditions remain favorable, and no significant damage has been observed yet.

Market talks suggest that FCI will maintain reserve prices of INR 2300 (FAQ) and INR 2275 (URS) from April 1, 2024, until July 2024, subject to further orders. In today's trading sessions:

- Delhi prices weakened by INR 25 per quintal, trading at INR 2650 per quintal.
- Gujarat's new wheat prices fluctuated, with a decrease of INR 20 per quintal at INR 2480-2490 per quintal, while loose mandi prices stood at INR 2350 per quintal.
- Uttar Pradesh market witnessed a decline of INR 20 per quintal, trading at INR 2580 per quintal.
- South MP's new wheat line traded lower by INR 10 per quintal at INR 2640 per quintal, and Bangalore MP line saw a decrease of INR 30 per quintal at INR 2750 per quintal.
- Kolkata wheat prices traded lower by INR 10-20 per quintal at INR 2710 per quintal, while Bihar prices also weakened by INR 10 per quintal at INR 2520 per quintal.

Market dynamics indicate:
- New wheat mandi prices in MP are trading at INR 2350-2400 per quintal, with upcoming rakes from Chhindwara, Dabra, Datia, etc.
- Millers are the primary buyers of new wheat, while stockists remain cautious due to stock limit norms.
- Rajasthan wheat prices traded weaker by INR 20 per quintal at INR 2490 per quintal.

Although official notifications regarding the reported market talks are pending, sentiments are under pressure. If FCI sells wheat at reserve prices of INR 2275-2300 until July, significant price rises are expected to be challenging. Furthermore, with bumper arrivals anticipated in the coming weeks, any significant decline in prices is unlikely due to active government procurement at MSP of INR 2275 per quintal, along with a bonus of INR 125 per quintal in two states.

Overall, market participants adopt a cautious approach, waiting for influential factors before committing to bulk stocks. Significant rises in wheat prices in the near term are unlikely, given the current market scenario.