The wholesale price of wheat in India continues to rise despite the government's efforts to stabilize it through the open market sale scheme (OMSS). The Food Corporation of India (FCI) has been selling 2 lakh tonnes of wheat weekly, but this has not translated into lower wholesale prices. Data shows that the all-India average wholesale price of wheat increased from ₹2,903/quintal on October 22 to ₹2,940 on November 12, even as the government's e-auction prices either fell or remained constant.
Experts and traders suggest that the government needs to investigate why wholesale prices are not reflecting the trends seen in the e-auctions. They also recommend direct participation by traders to address the issue. A senior official noted that timely release of wheat in the open market could have controlled inflation. The government is closely monitoring market rates for both wheat and atta (raw wheat flour).
Traders allege that some rice mills are falsely identifying as wheat processors to buy grain from the government at lower rates and then selling it at higher market prices. The number of successful bidders in key wheat-producing states has surged significantly since the government doubled the quantity in weekly auctions. For example, in Punjab, the number of successful bidders increased from 204 on October 21 to 325 on November 11.
Leading flour millers express concern over the fluctuating quantities of wheat offered in weekly auctions and the lack of transparency in transactions. They prefer buying from the open market despite the higher prices to avoid accounting complications. The government's retail inflation, driven by high food prices, breached the upper limit of the 2-6 per cent target range in October, reaching 6.09 per cent. Food inflation spiked to 8.94 per cent, with rice inflation at 12.51 per cent compared to 3.05 per cent for wheat.