MUMBAI/NEW DELHI- India plans to sell wheat from its state reserves to bulk consumers such as flour millers and biscuit makers from next month, according to a government order seen by Reuters, as it seeks to keep a lid on local prices by boosting supplies.
The government has allowed the state-run Food Corporation of India (FCI) to start offering wheat from its inventories from next month at 23,250 rupees ($279) a ton, the order said, nearly 12 percent lower than prevailing open market prices.
FCI is yet to decide the quantity of wheat that it plans to sell on the open market.
Last year, FCI began selling wheat to private players in June. It sold a little more than 10 million metric tons in the fiscal year to March 2024, a record sale from state reserves.
Because of the attractive price at which FCI will offer the wheat from its stocks, many private players would be interested in buying the grain in large quantities, said a Mumbai-based dealer with a global trading house.
Indian wheat prices have jumped nearly 6 percent year-on-year.
After five consecutive record harvests, a sharp rise in temperatures shrivelled the wheat crop in 2022 and 2023, pushing up prices of the staple and prompting the world’s No. 2 producer to ban exports.
Even this year’s crop is 6.25 percent lower than a government estimate of 112 million metric tons.
