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Informist, Thursday, Nov. 13, 2025

 

By Afra Abubacker

 

NEW DELHI – Weekly auctions of wheat for 2025-26 under the open market sales scheme started on a weak note. The Food Corp. of India sold just over one-third of the 200,000 tonnes it offered due to weak demand amid ample market supplies at competitive mandi prices. 

 

On Wednesday, the corporation sold only 36% or 72,856 tonnes wheat on offer, according to an FCI official. In contrast, FCI had robust sales last year, when it began wheat auctions in December, and millers and processors had picked almost the entire quantity offered in most rounds. 

 

"There is ample availability in all producing as well as consuming states," Rahul Chauhan, director, IGrain India Pvt. Ltd., said. Traders need not resort to wheat from government godowns to meet their demand, he said. 

 

In addition, FCI wheat is not competitive against private supplies in most states, as the government's wheat reserve price excludes freight charges, market participants said. For 2025-26, the government has set the wheat reserve price at INR 2,550 per 100 kg, and mandi rates are around INR 2,650-INR 3,000 per 100 kg across various markets in the country.

 

Sandeep Bansal, an Uttar Pradesh-based miller, said, "The rates offered by FCI need to be at least 3-5% discounted (from market rates). Only then do buyers feel there is an opportunity." Buyers must bear advance payment, freight charges, documentation and compliance costs when purchasing wheat from FCI. "So, unless and until we have some good savings, we usually prefer private supplies rather than government supplies." 

 

The last time FCI included freight charges in reserve prices was in 2023-24, the General Election year, Bansal said. Currently, FCI wheat is only competitive in some states, such as Punjab, Haryana, Jammu and Delhi, Bansal said. "Because FCI doesn't include any freight costs in Haryana and Punjab. So INR 2,550 is the base rate offered in these states. Then the nearest state is Delhi and Jammu, which are kind of destination states," he added. FCI procures most wheat for the central pool from Punjab and Haryana. 

 

In Punjab, FCI sold 17,506 tonnes of wheat of the 25,000 tonnes offered, marking 70% offtake. In Uttar Pradesh, FCI offered 14,500 tonnes of wheat, but the offtake was hardly 10%, Bansal said. Uttar Pradesh majorly depends on private supplies amid ample availability of the grain. 

 

Market participants do not see wheat sales pick up in the coming weeks. "We may see some marginal improvements, but not expecting a very big change," Bansal said. Unlike last year, traders actively bought wheat from farmers in Apr-Jun and private stocks are quite comfortable across the country. 

 

Asked about the government's timing of beginning wheat open market sales in November, against the typical start of August, Bansal said FCI had to release its wheat stock as it sits on surplus foodgrain stock. 

 

As per Bansal, if FCI had started selling wheat in August itself, it would have worsened the situation, as it would have entered into the already-well-supplied market. If open market sales had been delayed till January, private players would have escaped the pressure from FCI wheat and "definitely have got the chance to escape this bearish market," he said.  End

 

Edited by Deepshikha Bhardwaj

 

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