Wheat Weekly Review: Price Surge Amid Supply Constraints and Strong Demand
09-Nov-2024 06:02 PM
New Delhi, 9 November 2024 – Wheat prices continued their upward trajectory this week, fueled by limited supply and strong demand from millers-processors. Despite wheat stocks being transported from northern states to southern and northeastern regions like Karnataka and Assam, the quantity arriving in local markets remains low, tightening supply and pushing prices higher.
The central government has refrained from releasing any additional wheat stock into the open market or reducing import duties, further exacerbating the situation. These policy decisions are seen as contributing to the tightness in domestic wheat availability, keeping prices on the rise.
Key Price Movements (2-8 November 2024):
- Delhi: Wheat prices from Uttar Pradesh (UP) and Rajasthan saw a rise of Rs 10, reaching Rs 3150–3170 per quintal.
- Indore: Prices climbed by Rs 70, touching Rs 2800–3470 per quintal.
- Bhopal (Madhya Pradesh): Wheat prices increased by Rs 100, ranging from Rs 2800 to Rs 3100 per quintal.
- Itarsi: Prices surged by Rs 160, reaching Rs 2850–3050 per quintal, although Khandwa saw a Rs 100 dip.
- Bundi (Rajasthan), Shahjahanpur, Sitapur, Gorakhpur, Mainpuri, Etah (Uttar Pradesh): Prices rose by Rs 30–60 per quintal in these key wheat-producing regions.
The national average wholesale price of wheat was reported at Rs 2811 per quintal, while retail prices were higher at Rs 3200 per quintal. This disparity reflects the growing inflation in wheat prices across India.
Impact on Flour Prices
The government's Bharat brand flour has seen a price hike, with the retail price rising from Rs 275 per 10 kg to Rs 300 per 10 kg. This price increase signals that the government is acknowledging the market reality of rising wheat prices and is adjusting its policies accordingly.
Rabi Sowing Progress
With the Rabi season underway, wheat sowing has already commenced. However, the market dynamics in the coming weeks could depend heavily on the weather conditions and any future government interventions regarding stock release or import duties.
Outlook: Wheat prices are expected to remain firm in the near term due to continued strong demand, limited supply, and government policies that are not expected to ease the pressure in the immediate future.