Ground report on Wheat: Why are prices rising? Will they go up further? Here is a report!

Ground report on Wheat: Why are prices of wheat rising and will they go up further? Will gold manage to hold levels above Rs 52500 per 10 gram? Is there still some correction still left in crude oil? To know all your queries on the commodities here is a report by Zee Business’ Mrityunjay Kumar Jha.

There has been a big shortfall in government’s procurement of Wheat. Till now there has been a shortfall of 27 per cent in the procurement of wheat. In mandis, the price of price of wheat is above the Minimum Support Price (MSP).

The government’s procurement programme has been hit because of the spiraling prices of wheat. The prices have risen because of the exports. The prices of wheat have risen because of the supply side problems that have arisen due to the ongoing Russia-Ukraine war.

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He said that farmers are getting a good price for their produce and and hence the government procurement is coming down. He said that this should not sound alarm bells as the government has more than adequate stock with it.

Now the question is whether prices will see a further increase. Jha also explains trends in gold and crude oil. Here is the full report!

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The government's total wheat procurement may significantly decline to 27 million tonnes in the current 2022-23 rabi marketing year amid aggressive buying by private players for export and slight fall in the domestic production, PTI reported quoting official sources.

However, the expected fall in domestic output and the government's wheat buying will not impact grain requirement under the Public Distribution System (PDS), Other Welfare Schemes (OWS) and Pradhan Mantri Garib Kalyan Yojana (PMGKAY) due to the surplus buffer stock, the sources said.

This may also not impact domestic retail prices which have largely remained stable despite global inflation due to the ongoing Russia-Ukraine crisis, the report said quoting the sources.

 Further, the sources said the country's wheat production is estimated to be 105 million tonnes in the 2021-22 crop year (July-June), lower than the previous year's actual production of 109.59 million tonnes.

Wheat harvesting is underway in the current rabi marketing year which runs from April to March but the bulk of procurement ends by June.

State-owned Food Corporation of India (FCI) and state agencies undertake procurement at a minimum support price to meet the requirement under the Public Distribution System (PDS) and other welfare schemes.

Till April 20 of the ongoing rabi marketing year, the government agencies have been able to buy 10.9 million tonnes of wheat, much lower than the year-ago period.