Wheat area rises as markets await Centre's approval for open sales

This is 12 per cent more than the normal area and among the highest in recent years. Normal area is the average area of the last five years

As owners of flour mills await the Centre’s decision to liquidate part of its wheat inventories to cool atta (flour) prices, crop sowing for the marketing season that will start from April reached a new high of 34.11 million hectares during the week ended January 20.
 
This is 12 per cent more than the normal area and among the highest in recent years.
 
The normal area is the average of the previous five years.
 
But, compared to 2022, wheat acreage is just 0.38 per cent higher.
 
With the sowing of rabi crops almost over in most parts of the country, there is very little chance of any significant rise in area now.
 
The wheat crop sown early will start hitting the market in late February in Gujarat, with Madhya Pradesh and Rajasthan to follow.
 
Meanwhile, sources said a final call on the amount of wheat the Centre planned to liquidate from its stocks would be taken in a day or two and the price was expected to be around Rs 24 per kg.
 
This will be significantly lower than the prevailing market price of Rs 30 per kg for average-quality wheat in North India.
 
The market expects the government to liquidate around two million tonnes from its inventories through the Open Market Sale Scheme (OMSS).
 
The sales could be through tenders.
 
“It seems though all clearances for sale have been approved some modalities still needed to be worked out, and this could be delaying the process,” a trader said.
 
He said even if two-three tenders were floated, that will cool prices immediately.
 
“At least one tender a week will go a long way in controlling prices, which have risen sharply in the past few days,” the trader said.
 
Food Secretary Sanjeev Chopra in a press conference on Thursday said the Centre was seized of the spike in wheat and atta prices and was thinking of measures to reduce them.
 
Meanwhile, on the wheat crop, sources said its condition in most parts of the country was excellent and if temperatures did not rise sharply in February or March India was on course to harvest a bumper crop.
 
“To me the window of sale through the OMSS route is getting shorter by the day and the government should act fast; or else it might find it difficult to fill its inventories for the coming year if private traders pay more than the official minimum support price for the 2023-24 marketing season, which is Rs 2,125 per quintal,” the trader said.