New Delhi, March 5 (Commoditiescontrol): Wheat prices in major centers have traded steady to slightly firm, supported by various factors. Reports of the Food Corporation of India (FCI) closing wheat auctions have contributed to the firmness in prices. Additionally, the news of the government initiating wheat procurement soon at Minimum Support Price (MSP) has further supported the market.
New wheat (mill quality) prices are trading at Rs 2300-2400 per quintal across major mandis. Wheat harvesting is currently underway in Maharashtra, Gujarat, and some parts of Madhya Pradesh. In Rajasthan, harvesting is expected to commence by the end of March, in Uttar Pradesh by the first week of April, and in Punjab & Haryana by the second week of April. However, there might be a delay in some parts of Madhya Pradesh due to recent rainfall.
Millers are facing a supply crunch, and until arrivals improve significantly by March 20-25, wheat prices are expected to see further improvement in the coming weeks.
Unfavorable weather conditions, including heavy rains and hailstorms in major wheat-producing zones, along with a forecast of higher temperatures in the second half of March, have supported market sentiments.
The government has stopped the Open Market Sale Scheme (OMSS) of wheat, which was being carried out since June last year through weekly e-auctions. This decision has provided support in origin markets like Bihar and Uttar Pradesh.
Market Specifics:
- Delhi: Traded up by Rs 75 per quintal at Rs 2700 per quintal.
- Gujarat: Local wheat market traded upward with reports of cloudy weather in some parts.
- Rajasthan: Wheat traded steady at Rs 2500-2520 per quintal.
- Uttar Pradesh: Traded strong by Rs 25 per quintal at Rs 2600 per quintal.
The government's announcement to start procurement at MSP soon across major states and providing a bonus of Rs 125 per quintal in Rajasthan has further supported prices.
Stockists and processors are cautious due to stock limits imposed by the government. However, the government is under pressure to buy amid depleting FCI stocks, limiting significant declines in wheat prices.
Clarity on wheat production and government policies is crucial for a more precise understanding of the market. Despite uncertainties, wheat prices are unlikely to decline significantly from current levels, with potential upside once more clarity on production and government policies emerges.
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