While states are seeking Centre?s help in controlling spiraling food prices, they themselves have lifted just around 12% of the total wheat allocated to them under the Open Market Sale Scheme (OMSS) till last week.

The scheme under which around 20 lakh tonne of wheat and 10 lakh tonneof rice were allocated to states for being distributed between October to March 2010 to check rising prices, has evoked poor response.

Till last week, of the allocated 20 lakh tonnes of wheat, states have lifted just 2.4 lakh tonnes

States like Uttar Pradesh, Andhra Pradesh, Orissa, Jharkhand, Arunachal Pradesh and Tripura had not lifted a single tonne of wheat allocated under the scheme till last week, while Delhi, Punjab, Haryana, Bihar, West Bengal, Assam, Orissa hadn?t done so for rice, the main foodgrain for most East Indian states.

The issue of poor lifting by states is expected to prominently figure in the state chief minister?s meeting with the Prime Minister later this week and also in the presentation that food ministry proposes to make to the Prime Minister ahead of the chief minister?s meet.

Officials said, states have been unwilling to lift the allocated quantities of foodgrains under the scheme because they want the grain at PDS prices, while the central government is willing to sell them at FCI procurement cost plus freight from Ludhiana to the respective state capital.

Tamil Nadu and Kerala are among the state that have lifted the maximum quantities of wheat and rice allocated under the scheme since October.

In total, the central government has allocated around 61.32 lakh tonnes of wheat and 20.93 lakh tonnes of rice to be sold through the channels of states, bulk buyers and Nafed and NCCF. States have bought just over 300,000 tonnes of rice allocated to them for OMSS.

However, in case of bulk buyers, the response has been far better. Of the allocated 15.81 lakh tonnes of wheat under OMSS, almost 600,000 have been purchased till now.

The big change came, after the central government reduced the sale price of wheat sold through OMSS by average Rs 200 per quintal.

In November 2009, the pricing mechanism worked out by the high level committee consisting of officials from the food ministry included cost of purchase by FCI (minimum support price) along with additional carry forward, storage and freight cost etc.

In Delhi , the cost of wheat worked out was Rs 1,400 a quintal while in Kerala it worked out Rs 1,789 per quintal, which was far above the prevailing market price and the government could sell only 30,000 tonne of wheat.

The government was of the view that subsidized wheat could not be sold to flour millers as it is millers? responsibility to get wheat from the open market.

Subsequently, the empowered Group of Ministers (eGoM) had to reduce the offer price of wheat by around Rs 200 per quintal last month. The sell price of wheat at present includes FCI wheat procurement cost during 2008-9 and freight from Ludhiana .

Sources said that wheat approved for sale under OMSS would be available in Delhi at Rs 1254 per quintal against Rs 1437 per quintal as per the previous pricing structure.