NEW DELHI: The government is set to come up with more measures to tame the prices of wheat and atta (wheat flour) even as retail inflation eased to 5.7% in December. Aware of the repercussions of inflation, particularly of
cereals
, ahead of the string of crucial assembly polls this year, the government is likely to continue the
export
curbs on wheat and impose
stock limits
to check hoarding, besides releasing more quantity of the foodgrain to the market.
A top functionary in the food ministry told TOI that the government will exercise all
market intervention
options to bring down the prices of wheat and atta in the next one month. “The current restrictions on wheat export will continue as meeting the domestic demand remains the first priority. We have the option to notify stock limits and that will be exercised, if the need arises,” he said.
TOI had on January 25 first reported how relaxation of export restrictions is unlikely before the next crop.
The official said they are confident of significant reduction in prices of wheat and atta in the next 3-4 weeks. “We are also looking at releasing 20 lakh tonnes of wheat from government stocks to the market to increase availability. This will be in addition to the current allocation of 30 lakh tonnes for open market sale. In total, we can go up to offloading 50 lakh tonnes of wheat for market intervention,” he said.
So far around 9.3 lakh tonnes have been auctioned and Food Corporation of India (FCI) will offer another 15 lakh tonnes next week. The government is also offering wheat to cooperatives to convert them to atta and sell at Rs 27.5 per kg. While entities such Kendriya Bhandar, NAFED and NCCF are buying FCI wheat, there has been no demand from state government cooperatives so far.
A food ministry official said, “No state government cooperative has approached us or sent requests for wheat. Their participation will have far more impact on the prices across states.”
Even a fortnight after the government announced to offload the first tranche of wheat from FCI, prices of atta have not fallen as was expected. There has been minor correction in prices in the range of Rs 1-3 per kg in the past 10 days.
The Centre will hold a meeting of state food secretaries next month to arrive at an estimate of wheat procurement. “Wheat production is expected to be around 110 million tonnes and so we expect the procurement will be better this year,” an official said.