Friday 31 August 2012

Food Ministry to seek CCEA nod for additional 3 million tonne OMSS wheat sale

30 AUG, 2012, PTI
NEW DELHI: The Food Ministry is looking to sell additional three million tonne wheat in the open market to bulk consumers such as flour millers, a move aimed at containing price rise and offloading surplus stocks.

"We are taking a proposal before the Cabinet Committee on Economic Affairs (CCEA) for releasing another three million tonnes of wheat to bulk consumers under the open market sale scheme (OMSS)," Food Minister K V Thomas told reporters.

In June, the government had allocated sale of three million tonnes of wheat from its godowns under the OMSS to ease storage pressure during monsoon season.

If this proposal is approved by the CCEA, the total quantity of wheat to be sold in the open market would reach six million tonnes in this fiscal.

Asked about status of 3 million tonnes of wheat sale approved in June, Thomas said, "We have already released 1.3 million tonnes of wheat under OMSS. Another one million tonnes of wheat will be sold next month and the remaining quantity will be released thereafter."

The ministry has decided to release a total of six million tonnes of wheat under the OMSS, though the Commission for Agriculture Costs and Prices (CACP) had suggested 10 million tonnes of the grain, he said.

As per latest data, the entire quantity allocated in the first tranche has been sold to bulk users by the Food Corporation of India (FCI).

Under the OMSS, FCI has sold wheat initially at a floor price of Rs 1,170 per quintal through the tender process. The base price was hiked to Rs 1,285 from early this month.

Meanwhile, wholesale prices of wheat have been rising due to short supply of the grain in the open market and fears that wheat crop in the rabi season may be down due to poor rains.

Wholesale prices in the national capital have risen by 22 per cent to Rs 1,625 per quintal in the last one month.

As on August 1, the government has total stock of 76 million tonnes of foodgrains, out of which wheat is 47.52 million tonnes. The storage capacity is 71.41 million tonnes.

The government's stocks have risen sharply due to record production and procurement in the last few years.

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