Wheat Prices Show Steady to Higher Trends in Some Regions

New Delhi, February 29 (Commodities Control): Wheat prices exhibited a steady to higher trend in Delhi, UP, and Rajasthan, driven by robust spot demand and uncertainties surrounding the Open Market Sale Scheme (OMSS) tenders. However, prices remained stable in MP, Gujarat, and Maharashtra due to the influx of new crop arrivals.

The government's decision to halt OMSS, which has been conducted since June of the previous year, has created market uncertainty. This scheme, conducted through weekly e-auctions, recorded record sales of 9.4 million tons to bulk buyers. Although there are speculations about the possible continuation of OMSS in Punjab and Haryana in the next two weeks, there has been no official confirmation.

Amid projections of a record wheat output, the government has increased the grain procurement target for the 2024-25 season (April-June) to approximately 30-32 million tons. This is a significant increase from the 26.2 million tons purchased from farmers under the Minimum Support Price (MSP). Procurement targets for Punjab and MP are estimated at 130 lakh tons and 80 lakh tons, respectively, for the next marketing season.

The government has announced an MSP of INR 2275 per quintal, representing a 7% YoY increase. Additionally, the Rajasthan government has declared a bonus of INR 125 per quintal. Other state governments, such as UP and MP, may also announce a bonus of INR 125 per quintal.

In specific markets:
- Delhi saw a price increase of INR 25 per quintal, trading at INR 2625 per quintal.
- Gujarat's new wheat prices remained steady at INR 2500-2520 per quintal.
- Rajasthan's wheat traded steadily at INR 2500-2520 per quintal.
- UP witnessed strong wheat prices, up by INR 25 per quintal at INR 2525 per quintal.
- South-UP line reported robust trading, increasing by INR 30 per quintal at INR 2930 per quintal.
- MP's wheat prices traded at INR 2550 per quintal, while South-MP line remained steady at INR 2825 per quintal due to new arrivals in the Ratlam and Dewas regions.

Overall, prices are anticipated to exhibit marginal firmness in the near term but may weaken in the short term once peak arrivals commence around March 15.