Year: 2017

Research bureau Strategie Grains has cut its forecast for wheat harvest in the European Union this year to frost in key growing areas. The agency cut its estimate for the wheat crop in EU this year by 1.1 million tonne to 142.7 million tonne. That figure could change because the impact of the drought and cold spells the crops were subjected to is still difficult to assess accurately.

Wheat prices are likely to fall in at least eight states–Punjab, Haryana, Uttar Pradesh, Madhya Pradesh,Kerala, Andhra Pradesh, Telangana and Tamil Nadu as the food grain has been kept in the 0% rate under the Goods and Services Tax regime. which will subsume most indirect taxes from July. Punjab and Haryana levy 2% sales tax and 4% value added tax on wheat. While a 5% tax has been imposed under GST on branded flour, this won’t lead to rise in prices as organised players benefit from input tax credit on packaging material. Unbranded wheat flour has been kept at 0% tax slab under GST, and this may pull down its prices in states that levy a tax on the commodity now.

Futures contracts of wheat fell nearly 1% on the NCDEX as investors continued to book profits for the second straight day after prices rose in six trading days. June contract of wheat on the NCDEX was down 0.7% from the previous close. July contract also traded 1.0% lower at 1,643 rupees. Prices had risen earlier due to lower supplies in spot markets and firm demand from stockists and millers. Arrivals in benchmark market of Indore, Madhya Pradesh, were at 10,000 bags (1bag=100kg) down from 12,000 bags on previous close. Arrivals fell in Delhi as well, to 4,000 bags from 5,000 bags on previous close.