New Delhi, March 15 (CommoditiesControl): In the wheat market, prices are witnessing a blend of steadiness and weakness across major centers, influenced by various factors including supply improvements and government policies. Here's an overview of the current market scenario:
Wheat prices remained steady to weak at major centers, with Delhi prices registering a decline of INR 90 per quintal, settling at INR 2660 per quintal. In Gujarat, new wheat prices traded steadily within the range of INR 2500-2510 per quintal.
The UP market also experienced a decline of INR 40 per quintal, reaching INR 2600 per quintal. In Kolkata, wheat prices softened by INR 20 per quintal, standing at INR 2810 per quintal.
April forwards for South-MP wheat are trading at INR 2700 per quintal, with spot wheat fetching prices in the range of INR 2760-2780 per quintal.
In Madhya Pradesh, new wheat mandi prices are trading at INR 2350-2360 per quintal, with millers emerging as the major buyers. Meanwhile, Rajasthan's wheat prices remained steady at INR 2510 per quintal.
The Ministry of Agriculture revised its wheat production estimates downward by 2 million tons to 112 million tons. Notably, production is expected to decline only in Rajasthan, Bihar, and Maharashtra, while other major wheat-growing states may report higher production.
The Government of India (GOI) has set a procurement target of 30-32 million tons, aiming to bolster government stocks. There are discussions to potentially increase this target to 33.4 million tons, based on states' commitments to contribute to the central pool.
With a procurement target above 30 million tons, the government aims to avoid wheat imports to fulfill allocations for Public Distribution System (PDS) and Open Market Sale Scheme (OMSS). However, the supply-demand (SND) situation may remain tight if imports are not permitted.
Current wheat prices maintain a premium over Minimum Support Price (MSP), buoyed by bonuses announced by MP and Rajasthan. A potential bonus announcement in UP could further impact market dynamics.
The majority of arriving wheat, except for the Indore region, has higher moisture content, prompting deductions by bulk buyers.
Given weak government stocks, aggressive procurement measures are anticipated, mitigating the likelihood of significant price declines in the near term.
The duration of stock limit regulations remains uncertain, affecting stocking activities and price trends. The government's decision regarding stock limit extension will be pivotal in shaping market dynamics.
Recent delays in harvesting due to western disturbances add further uncertainty to price trends, with government policies playing a crucial role in determining market direction.
Overall, the wheat market is characterized by a complex interplay of supply trends, policy decisions, and weather-related factors.
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