A large number of flour millers confirmed to ET that FCI officials have been checking wheat stocks held by the mills.
The FCI sells wheat to flour mills and other bulk consumers under the open market sales scheme (OMSS) to keep domestic prices down. In June, it had offered 1.5 million tonnes of wheat under this scheme. However, wheat prices continue to remain firm.
Industry executives have cited the lower volumes offered by FCI at its weekly tenders as one of the reasons for the increase in wheat prices.
The mills participating in the bidding process have to declare the stocks held by them.
As the festival season’s monthly wheat demand is expected to increase by 50-100% between September and November, the processing industry says the lower volumes offered by FCI for bidding has resulted in higher bid amounts.”We have demanded that the FCI should increase the bidding limit of 100 tonnes of wheat per week per bidder to 300-500 tonnes per bidder per week and also double the quantity offered for tendering accordingly,” said Navneet Chitlangia, vice president of Roller Flour Millers’ Association of India (RFMAI).Wheat prices have increased by about 10% in the last one month, and by about 3% in the last one week. In private trade in Delhi, prices are higher than FCI’s rates by 13-15%.
