The Centre has decided not to extend stock limit on wheat after it expires on March 31, while continuing the mandatory weekly stock declaration from April 1 so that it keeps a tab on who is buying how much.
However, traders and stockists are apprehensive of re-imposition of stock limit at any time depending on the progressive procurement, which has started earlier than normal in some places.
The Department of Food and Public Distribution is maintaining a close watch over the stock position of wheat to prevent speculation, control prices and ensure easy availability in the country, according to an official statement released on Tuesday.
Curbing hoarding
The government has decided that traders, wholesalers, retailers including big chains and processors in all States and Union Territories shall continue to declare their stock position of wheat on the specific portal starting from April 1 and update it on every Friday till further orders, the Food Ministry said.
The decision has been taken in order to manage the overall food security and to prevent hoarding and unscrupulous speculation, the Ministry said. Further, it said that as the wheat stock limit is expiring on March 31 for all categories of entities, thereafter, these entities have to disclose the stock on portal.
The government has also directed unregistered entities to register on the portal at the earliest and begin disclosing their wheat stock every Friday.
Aggressive buying likely
Traders said due to lower wheat availability, in both the government and private sectors throughout 2024-25, aggressive buying is likely. Some States have already started acting to curb this by warning private traders against paying more than the MSP, citing a reported order from a district magistrate in Uttar Pradesh.
The stock limit can return only if the procurement lags behind and there is no such indication as of now, official sources said. The procurement has kicked off well in Madhya Pradesh, Rajasthan and Uttar Pradesh as purchases were allowed to start before April 1, the usual commencement date of the season, sources said adding over 1 lakh tonnes have been bought in Madhya Pradesh since March 15.
Price outlook bullish
Farmers got good price last year as there was more demand and less availability. This year, despite a good crop predicted by all sections, the higher demand may keep prices bullish, stockists said adding the bonus being paid in Madhya Pradesh and Rajasthan has also aided to the prediction of a high price to continue even after May, when procurement ends.
According to Agmarknet portal, the total mandi arrivals recorded at over 2 million tonnes (mt) during March 1-24 this year against about 1.5 mt year-ago. The government has estimated wheat production to exceed its target of 115 mt during 2024-25 crop year (July-June).