The Indian Government has displayed remarkable adeptness in controlling wheat prices, demonstrating the effectiveness of its open market sales scheme (OMSS). The recent e-auction on August 16 showcased stable wheat prices, maintaining last week’s levels despite fluctuations observed earlier. This well-planned strategy underscores the government’s commitment to price stability.
Average price of $0,26/kg for wheat
During the ninth round of e-auctions, a total of 0.154 million tonnes out of the offered two lakh tonnes of wheat from 484 depots found takers, fetching an average price of $0,26/kg. Additionally, 10,550 tonnes of rice were sold out of 0.329 million tonnes offered from 289 depots, further substantiating the demand for these staple commodities.
Purchase limits for wheat and rice
The ongoing e-auctions prioritize retail price reduction by capping the maximum purchase limit at 100 tonnes for wheat and 1,000 tonnes for rice per buyer. This calculated move aims to encourage participation from small and marginal users, fostering inclusivity in the market. The government is ensuring a diverse and competitive marketplace by allowing more participants to bid for quantities from their preferred depots. Although processors have been demanding to increase their maximum wheat purchase limit to 500 tonnes per round, officials have concluded that the current policy effectively fulfils the primary objective of price reduction. This showcases the government’s adaptive approach, making changes where necessary to ensure policy effectiveness.
Stock hoarding
In line with preventing stock hoarding, traders have been excluded from participating in wheat sales under OMSS (D). Rigorous checks and inspections are being carried out at flour mills of processors who have procured wheat from FCI. A substantial quantity of 1.127 million tonnes of wheat has been sold through weekly auctions that commenced on June 28. The government’s commitment is evident as it aims to auction 5.0 million tonnes of wheat and 2.5 million tonnes of rice under the OMSS scheme.
Conclusion
The recent e-auction results underscore the Indian Government’s practical management of wheat prices through the OMSS scheme. This well-executed strategy maintains price stability and ensures a level playing field for various market participants. The government aims to secure a balanced and fair market for essential food commodities with prudent policies.
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