New Delhi, March 01 (Commoditiescontrol): Wheat prices demonstrated stability, with slight firmness observed in major trading centers, fueled by reports of the Food Corporation of India (FCI) closing wheat auctions. The impending initiation of government procurement at Minimum Support Price (MSP) added further support to the market.
Reports of substantial rainfall in the Saurashtra region of Gujarat and major wheat belts in Madhya Pradesh raised concerns about potential delays in harvesting, leading to expectations of reduced yields. These weather-induced uncertainties contributed to the overall firmness in wheat prices.
The government's decision to halt the Open Market Sale Scheme (OMSS) of wheat, which had been ongoing since June last year, brought an end to weekly e-auctions with record sales of 9.4 million tons to bulk buyers. This move provided support to origin markets, including Bihar and Uttar Pradesh.
In Delhi, wheat traded steady at INR 2625 per quintal. However, in Gujarat, new wheat prices experienced a decline of INR 100 per quintal, settling at INR 2400-2420 per quintal. Rajasthan witnessed stable trading at INR 2500-2520 per quintal. Meanwhile, Uttar Pradesh saw an increase of INR 25 per quintal, reaching INR 2550 per quintal. The South-Uttar Pradesh line, however, traded weak, dropping by INR 180 per quintal to INR 2750, influenced by new crop arrivals from Madhya Pradesh.
In Madhya Pradesh, wheat prices were down by INR 100 per quintal, trading at INR 2450 per quintal, while the South-MP line experienced a decline of INR 125 per quintal, settling at INR 2725 per quintal due to fresh arrivals in the Ratlam and Dewas regions.
The government's announcement to commence procurement at MSP soon, coupled with a bonus of INR 125 per quintal in Rajasthan, bolstered market sentiment. However, stockists remained cautious due to the existing stock limits imposed by the government and uncertainty regarding overall wheat supply expectations for the year.
The prevailing uncertainty over wheat production and the cautious stance of both stockists and processors, influenced by the government's stock limits, are expected to persist until more clarity emerges with decent arrivals in the mandis. The government, under pressure to increase procurement amid depleting FCI stocks, is likely to prevent any significant decline in wheat prices from current levels. The market is poised for further developments as more information becomes available regarding wheat production and government policies in the coming weeks.
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