Located in Asia, India is the second largest wheat producer in the world. The Asian nation produces around 13.53% of the total global wheat production. However, despite this, India accounts for less than 1% of the global wheat trade. Owing to high consumption needs, it consumes all of what it produces, leaving a meager portion behind for wheat exports.
In the aftermath of the Russia-Ukraine war which fueled up demand for Indian wheat amid reduced domestic harvest, India banned the exports of wheat and wheat flour in May 2022 to ensure adequate domestic supplies and check rising prices, while keeping the doors open for G2G deals to meet the needs of food insecure nations.
However, as per experts, India’s wheat exports did not serve the purpose it was implemented for and the same can be clearly seen after visiting the domestic markets of India. A stroll at the market is enough for anyone to state that wheat and wheat flour prices are touching new heights, thereby pinching the pockets of the common people.
To lessen the sufferings of the people of India, the Government of India have decided to release wheat stocks in the domestic markets in a bid to cool of the prices. The state agency, Food Corporation of India (FCI) has been tasked with the same and the agency has planned to release the wheat stocks into the market through e-auctions for the first time.
The Food Corporation of India (FCI) offered 22 lakhs metric tonnes of wheat out of 25 lakhs metric tonnes earmarked for e-auction from the central pool stock to the market through various routes in the first e-auction on February 1, 2023. A total quantity of 8.88 lakh metric tonnes were sold by the FCI in 22 states on the first day itself.
Strong Start To The FCI’s First e-auction Of Wheat
The first e-auction conducted by the Food Corporation of India (FCI) started on a sweet note as more than 1,100 bidders came forward to procure bulk quantities of wheat. A total volume of 8.88 lakh metric tonnes of wheat was sold by the FCI to bulk buyers in 22 states by the end of the e-auction on 1st of February, 2022.
Further, sale of bulk volumes of wheat will continue through e-auction on every Wednesday till the second week of March, 2023.
The Bottom Line
India is the second largest wheat producer in the world. However, despite this, owing to high consumption needs, the country contributes a meager 1% to the global wheat trade.
With a view to ensuring adequate domestic supplies and checking rising prices amid strong demand for Indian wheat in the aftermath of the Russia-Ukraine war, The Government of India (GOI) restricted the exports of wheat and wheat flour. However, that did not serve the purpose well and in a bid to cool domestic prices, the GOI allowed offloading bulk volumes of wheat in the open market to cool prices.
The state run agency, Food Corporation of India (FCI) has been releasing wheat through e-auction for the first time and in the first e-auction itself the FCI sold 8.88 lakh metric tonnes of wheat to bulk buyers in 22 states of India.
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