Govt. limits wheat stocks to control price rise, hoarding

A worker carries a ladder past sacks filled with wheat at a Food Corporation of India (FCI) warehouse in Punjab.  File

A worker carries a ladder past sacks filled with wheat at a Food Corporation of India (FCI) warehouse in Punjab. File | Photo Credit: Reuters

Sensing an upward movement in wheat prices and fearing hoarding ahead of the festive season, the Centre has decided to reduce the stock limits of wheat for traders, wholesalers, retailers, big chain retailers and processors in all States and Union Territories. The revised stock limit is 2,000 Metric Tonne (MT) which had been 3,000 MT so far. Briefing reporters about the decision, Union Food Secretary Sanjeev Chopra blamed “artificial scarcity” created by some people, behind the uptick in prices.

The Centre asked all wheat-stocking entities to register on the wheat stock limit portal and update the stock position every Friday. “Any entity which is found to have not registered on the portal or violates the stock limits will be subject to suitable punitive action under Section 6 & 7 of Essential Commodities Act, 1955,” the Food Ministry said in a release. It added that in case the stocks are at present higher than the prescribed limit, the sellers should bring it down within next 30 days. “Officials of Central and State Governments will be closely monitoring enforcement of these stock limits to ensure that no artificial scarcity of wheat is created in the country,” the release said.

Mr. Chopra said some people are holding wheat more than what they need, and creating artificial scarcity in the country, with prices going up unnecessarily. “Currently, wheat prices at retail level are ruling stable at ₹30 per kilogram, on an average. But we are anticipating that with this uptick in the NCDEX prices, there may be a reflection of these prices in the retail market,” he said.

Prices Under Control

When asked about the retail prices of foodgrains, sugar, and edible oil ahead of the upcoming festivities, he said there will not be any sharp increase in their prices and the Centre has adequate stocks of essential items. He said the government is keeping a close vigil on hoarders. “So my analysis is that in the upcoming festive season, I do not see any kind of a sharp upswing in prices of the commodities that we deal with whether it is wheat or rice or sugar or edible oils,” Mr. Chopra said.

He added that sugar prices are stable but rumours of likely shortage due to weak monsoon in August has resulted in an increase in prices in some areas. “So, this is just to clarify that there’s adequate sugar stock of 85 lakh tonne in the country, which is sufficient for three and a half months’ requirements,” he said. The government has released 25 lakh tonnes of sugar in August, which is two lakh tonnes in excess, Mr. Chopra said. He said the Centre expects bumper production of rice in this kharif season and sugarcane production will also be good in States like Karnataka and Maharashtra.

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