Month: June 2017

Chicago wheat futures rose for a third consecutive session with prices underpinned by dry weather threatening to reduce U.S. spring crop production. The wheat market has been supported as crop conditions in the northern U.S. Plains spring wheat region have deteriorated sharply in the last month due to hot and dry weather. Analysts expect the U.S. Department of Agriculture on Friday to lower its estimate of U.S. spring wheat plantings for 2017.

With wheat purchases still on in Rajasthan, the government total procurement of the food grain for the current marketing year ending March, has touched 30.8 million tonne, up 34.1%. The government wheat procurement has ended in the major producing states, except Rajasthan, where 1.24 million tonne wheat has been procured so far, up 62.8% from a year ago.

Prices of wheat fell in Delhi as buyers refrained from purchasing the grain due to lack of clarity on goods and services tax, to be implemented from Jul 1. In Delhi, mill quality wheat was sold down 10 rupees from previous close. Traders are not buying now, as they fear holding stocks ahead of GST as once they get a clear idea, they start accounting once again. Unbranded wheat is kept under the 0% tax slab under the new tax regime, while packaged and branded wheat is at 5%.

The government has sold 77,000 tonne wheat under the open market sales scheme in the current fiscal year so far. For 2017-18 (Apr-Mar), the government has set the average price at 1,790 rupees per 100 kg for procuring states and in non-procuring states, the reserve price rises by an amount equal to ex-Ludhiana railway freight. Higher prices have kept buyers away so far, and the quantity sold was only 19% of 409,100 tonne offered. The first tender was floated on Jun 15, offering 355,950 tonne for sale, of which only 36,000 tonne was sold. The second tender was released on Jun 22, and offered 373,100 tonne wheat but only 41,000 tonne was sold.