The Food Corporation of India (FCI), who is saddled with huge stock, will sell 10 million tonne of wheat to bulk customers this fiscal, which is almost 40% more than the previous year, as per a government order.
The government is providing wheat at a base price of Rs 2,080 /quintal to three main wheat-producing states – Madhya Pradesh, Haryana and Punjab while for other states the freight charges at Ex-Ludhiana will be added to the base price.
The FCI, the centre’s nodal agency for procurement as well as distribution of grains, will be selling wheat with the help of an e-auction under the open market sale scheme, also known as OMSS during the fiscal except in the procurement period in wheat growing states.
The food ministry’s order said, “Quantum of sale of wheat has been set at 100 lakh tonne. It could, however, be reviewed by the Department of Food and Public Distribution, if offtake is more”. It said the base rate will be hiked by Rs 55 / quintal in the subsequent quarters of the fiscal.
At present, the Food Corporation of India is having a huge stock of more than 40 million tonne of wheat. This comprises old stock of 16 million tonne till 1st April and 24.2 million tonne of new grain from the current procurement, according to official data.
The organization has fixed the wheat procurement target at 35.7 million tonne for the 2019-20 financial year (April to March) with the hope of a record 100 million tonne productivity this year.
Traders said wheat prices are going below minimum support price of Rs 1,840 / quintal at present. The base rate given under the OMSS for this fiscal is much higher than the minimum support price & also from the previous year’s base rate. Traders are purchasing wheat at a low price directly from the open market & might think of buying from the FCI after the procurement period is over, they said.
In the last fiscal, the Food Corporation of India had sold 7 million tonne of wheat at a base rate of Rs 1,900 / quintal.