The government's sale of excess wheat stock in the open market is gradually picking up pace.
The government’s sale of excess wheat stock in the open market is gradually picking up pace. More than 2.4 lakh tonne of wheat had been sold under the open market sale scheme (OMSS) to bulk buyers till Friday through weekly auctions this fiscal.
Food Corporation of India (FCI) officials told FE that buyers like private food companies in the last couple of weeks have purchased close to two lakh tonne of wheat through OMSS. FCI for the first time in the current fiscal had commenced OMSS in key procuring states in July.
“We expect the demand for OMSS wheat to grow in the coming festive months as the demand from the private sector usually increases after September,” an FCI official said.
The corporation is aiming at selling more than six million tonne of wheat under OMSS by the end of current fiscal, which would reduce quantum of surplus wheat stocks held with the FCI. The state-run agency had sold 4.2 million tonne of wheat under the scheme in the previous fiscal.
The FCI conducts a weekly auction to sell wheat in the open market using the platform of commodity bourse NCDEX. The government has set a reserve price of R1,500 per quintal plus freight cost to consuming locations.
A food ministry official said that the real worry for the FCI is the huge wheat stock in excess of 36 million tonne at the start of the month. A major chunk of 28 million tonne of wheat purchased during April-June this year is bought uder relaxed norms.