Wheat, pulses prices moderate after govt imposes stockholding limit
By Sanjeeb Mukherjee
There has been a moderation in price increase of the commodities on which the Centre imposed stock limits to prevent hoarding and ensure price stability, according to traders and data sourced from the consumer affairs ministry.
To control prices and check hoarding, the Central government on June 21 imposed stock limits on chana, kabuli chana, and tur which were followed by limits on wheat on June 26. The limits will be in force for pulses till September 30, after which they will be reviewed. For wheat, the limits are till March 2025.
According to the Department of Consumer Affairs data, the all-India average wholesale price of wheat rose by 1.3 per cent from April 1 to June 26 (the day when stock limits were imposed). Since then, the hike has been a moderate 0.36 per cent.
Private traders, however, say there hasn’t been much moderation and prices have even moved up in some centers. They attribute it largely to the short supplies of wheat in the market and some big traders still holding on to the wheat stocks.
They argue that unless the Food Corporation of India (FCI) starts liquidating some of the inventories, there won’t be any big moderation.
Wheat with traders, wholesalers, and big chain retailers has to be brought down to its prescribed limits within 30 days starting from June 26.
Traders say price moderation has been sharper in pulses compared to wheat because the summer season is usually a lean demand period for pulses as consumption of fried foods goes down.
It is also because imports of pulses are open at nil duty, and importers have been barred from holding on to the imported consignment of pulses beyond 45 days. This is also forcing them to quickly offload the pulse stocks into the market, they said.
Isma asks govt to allow export of surplus sugar
The Indian Sugar and Bio-Energy Manufacturers Association (Isma) has urged the government to immediately allow the export of the surplus 3.6 million tonnes of sugar that is projected to be generated following the ban on the production of ethanol from sugarcane juice imposed in December 2023.
Isma said due to the ban excess sugar has now been produced in the system which cannot be ploughed back to make ethanol. It estimated that India had an opening stock of approximately 5.6 million tonnes of sugar in October 2023, while consumption was estimated to be around 28.5 million tonnes.
This would lead to significantly higher closing stocks of 9.1 million tonnes as of September 2024 for the 2023-24 season. The normative closing stock at the end of any season should not be more than 5.5 million tonnes. This means that around 3.6 million tonnes of sugar will be in excess which needs to be shipped out to protect millers from potential extra costs from idle inventory and its carrying.
This article has been republished from The Business Standard.