NEW DELHI (Commoditiescontrol) - Wheat supply is expected to reach at peak in Delhi market in first week of May. The supply delayed by more than one month due to untimely rain in the region. The prices will reduce further when supply pressure will increase. The prices already fell down by Rs. 50-60/100kg during last couple of days. But wheat is likely to rule higher in Delhi compared to Rajasthan and Madhya Pradesh due to heavy consumption and logistic costs.
According to market sources, new wheat supply has reached to 6,000 bags (100kg each). Wheat is being supplied from Palwal, Faridabad and Hodal of Haryana which is adjoining region of western Uttar Pradesh.
In north India, Palwal line wheat arrives earliest in the market. After then, the supply begins from rest of Haryana and Punjab and Uttar Pradesh. Delhi gets most of the supply from Palwal line throughout the year due to proximity. Normally, the supply begins in first and second week of March and reaches at peak in last week of March or first week of April. But, bad weather disturbed harvesting and supply schedule. The supply could start by last week of current month.
A Delhi based trader Mr. Rajesh Kumar told Commoditiescontrol that wheat supply will increase gradually. It will reach to 20,000-25,000 bags a day in the first week of next month. Presently, moisture is as high as 14-15 percent and luster lost wheat ratio is also high. Recent rain affected grain proportion by around 10-12 percent. Rain affected wheat is being traded at Rs. 1,475-1,480/100kg, while good quality wheat is sold at Rs. 1,500-1,475/100kh. But 70-75 percent supply is rain affected so flour mills are buying wheat for their immediate need.
Rain affected wheat is not fit for storage. He says that price will come under pressure of heavy supply very soon and the prices may touch as low as Rs. 1,450/100kg. This year Palwal line wheat will not get good price because of delay. Earlier, the wheat reached at market when there is no heavy supply. But this year, wheat is flooded in Rajasthan and supply will reach in Haryana and Punjab very soon.
A trader from Palwal Mr. Ramesh Chand told that the farmers will not be able to get attractive price in Delhi. They supply their produce for better price but there is enough wheat at lower price.
A Kota based trader Mr. Uttam Chand Jethwani told that demand from delhi is very strong. The mills and retailers were purchasing wheat from various markets of Rajasthan because they did not get supply in Delhi market. Demand from Delhi market started in mid March and continues till now.
Presently, 20,000-25,000 bags wheat is being supplied daily from Rajasthan. But it will reduce, when local supply will increase because local wheat will be cheaper.
Interestingly, mill quality wheat prices are hovering at Rs. 1,475-1,525/100kg, while it is sold at Rs. 1,250-1,325/100kg in various markets of Rajasthan. The huge price difference remains throughout the season because of higher consumption and logistic costs in Delhi. Mr. Jethwani told that there is around Rs. 250/100kg cost of transportation, loading-unloading, packaging and taxation. So, the consumers get wheat at Rs. 1,500-1,525/100kg, which is equal to the prices prevailed in Delhi. When supply will increase and prices will come down, Delhi demand will decline.
On price trend and supply, Delhi based traders say that the prices will reduce in third week of current and it can touch Rs. 1,450/100kg. However, demand will increase when mills get good quality and they will buy wheat for their future need. In that case, price will get support.
(By Commoditiescontrol Bureau; +91-2261391533)