Wheat prices dropped below the minimum support level of Rs 1,285 a quintal on Friday following slack demand. This has happened for the first time since the rabi marketing season began.

New wheat eased by Rs 85 and quoted at Rs 1,200 a quintal but failed to attract buyers even at that level.

The support price fixed by the Government for this season is Rs 1,285 a quintal. Following stoppage of procurement by Government agencies and lack of demand from flour mills, prices have dropped to Rs 1,200 a quintal.

There are hardly any buyers even though prices have fallen below the support price, said Mr Sewa Ram, a wheat trader. Farmers and commission agents are ready to sell their produce for Rs 1,200 a quintal but stocks went unsold following lack of buying, he said.

“Government agencies have not made any procurement since May 11 as they are running short of space and bags for storage,” said Mr Sewa Ram.

On the other hand, low stocks kept desi wheat firm. Tohfa variety ruled at Rs 2,300 a quintal, Bhojan King was quoted at Rs 2,200, Rasoi bhog was at Rs 1,900 while the Nokia variety traded at Rs 2,150 a quintal.

Ample stocks, coupled with weak demand, pulled wheat further down on the futures market. The June contract on the National Commodity and Derivatives Exchange decreased by Rs 5 to Rs 1,182 a quintal; it had touched a low of Rs 1,178 a quintal earlier on Friday. July contract on the exchange went down by Rs 8 to Rs 1,197 a quintal.

Flour Prices

With a drastic fall in wheat, flour prices too went down by Rs 40 and quoted at Rs 1,230 for a 90-kg bag. On the other hand, Chokar remained unchanged on steady demand and sold at Rs 650-660 for a 49-kg bag.

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