Downtrend in The Prices
In the latest auction held by the Food Corporation of India (FCI), wheat purchases saw a modest decrease. Despite steady prices, the uptake reduced from 96% to 93%. This change reflects the broader market trends, where both retail and wholesale prices are on a downward trajectory.
Government Sales and Auction Details
Since June 28, the government has been proactive in selling wheat to ensure availability in the open market. To date, an impressive 8.94 million tonnes have been sold. In the auction on February 21, out of 0.5 million tonnes offered, 0.46 million tonnes found buyers. Notably, the offered quantity was increased by 50k tonnes from the previous auction, indicating the government’s commitment to market stabilization.
Price Insights
Wheat prices hold steady at $0.26 per kg, defying expectations. The average price of wheat remained stable this Wednesday, at $0.26 per kilogram, which is slightly higher than the previous week. This stability is particularly noteworthy considering that the price was at the same level back in December 2023. The government’s reserve price, set at $0.25 per kg, is significantly lower than the current production cost of $0.32 per kg, highlighting their effort to keep wheat affordable for consumers.
Regional Price Variations
Interestingly, prices varied across regions. The eastern region outperformed with an average selling price of $0,27/ kg, surpassing the minimum support price of $0,27/kg for the next season. However, prices fluctuated between $0,26/kg and $0,27/kg in other areas, with the northeast region peaking at $0,28/ kg.
Notable Highs in Karnataka
Karnataka stood out with the highest bid at $0,31 kg, signalling strong demand for specific wheat varieties in the state. Other states also saw significant bids, with West Bengal, Jharkhand, Uttar Pradesh, Maharashtra, Gujarat, Rajasthan, and Madhya Pradesh all fetching competitive prices.
Market Trends: Price Dropped In India
Recent data highlights interesting market trends. The pan-India average retail price of wheat dipped to $0,37/kg, marking a 0.68% decrease. Conversely, rice prices saw a slight increase. The wholesale market mirrored this trend, with wheat prices decreasing and rice prices inching upwards.
The FCI’s latest auction reflects the dynamic nature of the wheat market. With government efforts to stabilize prices and ensure availability, the slight decrease in uptake is a critical indicator of market sentiment. As prices stabilize and the government continues its intervention, the outlook for wheat availability remains positive.