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Government Releases Quota Of 7.13 Lakh Tons Wheat For OMSS

7 Sep 2020 3:13 pm
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NEW DELHI (Commodities control) The central government has released quota of 713,500 MT wheat for flour mills and other bulk consumers for current month. FAQ wheat will be sold at price of Rs. 2125 per quintal. As wheat prices in open markets are hovering below government’s price therefore very little impact is expected from the quota.

The government releases wheat under Open market Sale Scheme (OMSS) from central pool for bulk consumers including flour mills during off-peak season. A fixed quota is released every month by the government. State government can also purchase wheat under this scheme. Wheat is to be auctioned to bulk consumers with base price. The government has fixed price in last April. Base price for auction for current year’s FAQ wheat was fixed at Rs. 2125 per quintal. Freight charges are extra so mills of southern states will have to bear more cost. Mills and other industrial consumers can bid higher to this price.

The quota from central pool may have very little impact on open market dynamics as wheat prices are ruling much below than government’s release price. Wheat is being sold as low as Rs. 1550 per quintal in Madhya Pradesh and Rajasthan. In Delhi, the prices are ruling around Rs. 1825-1850 per quintal. Therefore, government’s quota cannot put pressure on open market. According to market sources, wheat prices are hovering at low level because of free and highly subsidized wheat is being distributed to around 80 crore consumers under regular PDS schemes and special schemes launched amid Covid-19. The Traders also sceptical about lifting government’s wheat due to price difference.

(By Commoditiescontrol Bureau: +91-22-40015505)

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