Wheat prices, which had fallen on ensuing rumours that India was likely to curb wheat exports to tame domestic inflation, have rebounded again by 2–3% after the food secretary, Sudhanshu Pandey, said that the government has no plans to stop wheat exports.
Traders expect that domestic wheat prices will continue to strengthen until wheat is shipped out of the country.
Traders said that the wheat prices had declined to Rs. 2350/quintal in Mumbai after the rumours about the export ban started making the rounds. After the government clarified that there was no plan to stop exports, the wheat prices jumped back to Rs. 2450/quintal.
Flour millers and exporters say that there has been hardly any selling of wheat since the statement of the food secretary saying that the exports will continue and they are not able to get any wheat in the market. The prices may continue to move upwards as long as wheat continues to move out of the country.
In the past, wheat used to sell around the MSP in the open market. Farmers have turned their backs towards the government wheat purchase centres as private traders are buying wheat at 20% to 25% higher than the government purchase price.
Navneet Chitlangia, Vice President, Roller Flour Millers’ Federation of India, said, “Wheat prices have started surging again at the auctions in mandis.” Right now, the availability of wheat at an optimum price is the biggest problem being faced by the processors.
The central government has revised its 2022-23 wheat production estimate downwards by 5.7%, from 111.5 million tonnes to 105 million tonnes, as a severe heat wave has adversely impacted the crop production.