FCI to offload more rice, wheat to control prices

Karam Prakash

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New Delhi, August 9

With the Union Government failing to control the rising retail prices of wheat and rice, the Food Corporation of India (FCI) has decided to offload additional 50 lakh metric tonnes (LMT) of wheat and 25 LMT of rice in the open market to cool down the rates.

The FCI, the nodal agency that regulates the foodgrain supply chain, would sell the stock through the Open Market Sale Scheme (OMSS), said an official. The Centre said the wheat prices had gone up by 6.77 per cent in retail market and 7.37 per cent in wholesale market over the last one year. Similarly, rice prices have gone up by 10.63% and 11.12%, respectively. “We are hopeful the foodgrain availability in the market will cool down the prices. If required, we will take more aggressive steps to control food inflation,” said Food Secretary Sanjeev Chopra, who agreed the prices hadn’t declined as much they had expected. The Centre had started offloading wheat through the OMSS in the last week of June. The FCI has already sold over 8 LMT of wheat—of the total 15 LMT offered—in seven e-auctions. The rice e-auctions started on July 5, but the FCI could not sell even 0.5% of the total 5 LMT offered. “Considering the experience of the past five e-auctions for rice, we have decided that the reserve price of rice e-auction will be brought down by Rs 200 per quintal,” said Chopra.

Curbing inflation

50 LMT of wheat to be sold under the Open Market Sale Scheme

25 LMT rice to be sold; only 0.5% of targeted 5 LMT was sold earlier

The government’s OMSS operations, however, have failed to yield the desired results. Questioned on this, Chopra said, “The prices haven’t come down as much as we had desired. Hadn’t we taken these steps, the prices would have gone much higher.”