India’s Food Secretary, Sanjeev Chopra, announced on Monday that the government is contemplating increasing the sale of wheat in the open market as a measure to manage the price of this essential grain. He reassured the public that there is no shortage of wheat within the country and emphasized that all possible avenues are being explored to regulate prices. This statement was made during a meeting with wheat millers, where discussions centered around the growing concern over rising wheat prices in India.
In a pivotal move to mitigate surging wheat prices in India, the country’s Food Secretary, Sanjeev Chopra, announced on Monday that the government is actively considering a significant increase in wheat sales within the open market. This strategic measure aims to stabilize the cost of this staple grain and alleviate concerns over potential shortages. During a recent meeting with wheat millers, Chopra reiterated that there is currently no shortage of wheat in the country, emphasizing the government’s commitment to exploring all possible avenues for price regulation.
The decision to explore increased wheat sales comes in response to a recent spike in wheat prices within India, which reached their highest levels in six months. The surge in prices prompted Indian officials to evaluate a range of measures to bolster domestic wheat supplies and cool local prices.
Last year, India imposed a ban on wheat exports following a sudden drop in wheat output due to unseasonal weather conditions. Despite the export ban, prices continued to rise, raising concerns that this year’s wheat crop might be lower than the government’s estimated record of 112.74 million metric tons.
India’s move to halt its largest rice export category in July further underscored the government’s determination to curb rising food prices, amid worries of global food market inflation. These measures align with Prime Minister Narendra Modi’s Bharatiya Janata Party’s (BJP) goals as it prepares for upcoming state assembly elections and a general election in the near future. In India, even moderate increases in food inflation can provoke public discontent and provide ammunition for opposition parties to criticize the government.
Inflation in India, the third-largest economy in Asia, has recently shown signs of acceleration after early indications of easing earlier this year. In July, food prices surged by 7.75% year-on-year, a sharp contrast to the 1.24% decline observed in June. The government’s efforts to control prices extend beyond wheat and rice, as it also seeks to manage the costs of vegetables and pulses.
Despite government efforts to maintain adequate wheat stocks, challenges emerged in replenishing inventories at state warehouses due to lower wheat output in 2022 and 2023. Wheat stocks at government warehouses stood at 28.3 million metric tons on August 1, higher than the previous year’s 26.6 million tons but below the 10-year average of 35.3 million tons.
To address the current situation, the government has made a crucial move by offering 5 million metric tons of wheat to bulk consumers such as flour millers and biscuit manufacturers. This initiative is designed to help stabilize wheat prices. An increase in stocks at state warehouses would have enabled the government to offer larger quantities, further contributing to price stability in the wheat market.