The Hindu Business Line : Wheat dips on fresh supply in Maharashtra

WHEAT prices, which have been rising in the market during the last couple of weeks, declined on Wednesday following the release of fresh stocks by the Maharashtra Government.

The wholesale prices of mill quality declined from a record Rs 1,115 a quintal to Rs 1,060 on reports of fresh supply from the State Government to local flour mills. Prices have increased by Rs 150 a quintal in the last one month.

Among other varieties, Lokwan ruled at Rs 1,125-1150, Sharbati at Rs 1,300-1,500 and Punjab were quoted at Rs 1,100 a quintal.

Arrivals from major terminal markets have also improved to 800-1,000 tonnes a day at APMC market this week, a local broker said.

The Union Government has released 1.5 lakh tonnes a month for the first quarter of 2006 under the Open Market Sales (OMS) scheme.

Out of this, Maharashtra has been allotted 15,000 tonnes for January.

On Tuesday, it released about 350 tonnes to local flour mills and another 150 tonnes to consumers' co-operatives societies at the rate of Rs 922 a quintal.

"Traders were awaiting this release since last week. The Government is going to supply about 15,000 tonnes to mills, bakery and consumers societies," a trader said.

The Government has increased its sale price by Rs 22 a quintal over the previous level.

"Supply was almost half of the total local demand last month but with this release, price have now stabilised at one point," the trader said.

"Wheat prices are likely to rule at current levels in the next few days on increased supply amid steady local demand. I think fresh inflows of new wheat from Saurashtra (Gujarat) will start from mid-February," a local broker said.

Wheat prices have climbed up on tight supply and steady local demand. The rise was mainly on reports that stocks with traders in Navi Mumbai had declined to 50,000 bags.

In the futures markets, wheat prices on NCDEX showed a downward trend.

January 2006 contracts were quoted at Rs 890 a quintal ex-Delhi on Wednesday, while February and March contracts ended at Rs 910 and Rs 834 per quintal respectively.