India Controls Wheat Prices With Stock Limits And Export Ban
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The Indian government is taking measures to prevent a rise in retail wheat and flour prices. This includes limiting the amount of wheat that can be held and releasing more grain from Food Corporation of India (FCI) stocks. The government will also maintain restrictions on wheat exports and increase purchase operations to ensure a comfortable grain level through the summer.
Why Such Measures?
The goal is to lower wheat prices before the start of Minimum Support Price (MSP) purchases by FCI and state agencies. Wheat mandi prices have already decreased as a result of the first e-auction, with a second e-auction planned for 15 February 2023. The FCI wheat stocks currently exceed the buffer standard, and retail prices are expected to fall once the grain purchased through the e-auction enters the market.
Insight
Despite weather fluctuations, the wheat crop is positive so far with higher sowing this season. The Agricultural Ministry will announce the first estimate of wheat production later this month. The FCI procurement decreased in the 2022-2023 marketing season due to lower production and increased global demand.
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