Indian Wheat Latest
Indian wheat futures continue to trade around contract highs at Rs 1,436/100kg, equivalent to around USD305/tonne, as the government prevaricate over releasing state-owned stocks onto the market.
The recently announced auction of 500,000 MT has met with a muted response as the minimum tender prices were well above the prevailing market levels. They are now said to be "considering" reducing the asking prices slightly at a meeting next week.
Tenders were invited at prices ranging from close to Rs 1,400/100kg in the north to almost Rs 1,800/110kg in the south. That's a hefty return on the Rs 1,080/100kg that the government paid for the wheat back in March/April, and appears to do little to help achieve their stated aim of reeling in food price inflation. To me it looks more like profiteering.
Today the government have announced an increase on the minimum support price it will pay the nation's impoverished farmers for new crop wheat for 2010. Their decision to increase the MSP by just 1.85% to Rs 1,100/100kg has also met with fierce criticism.
The chief minister of Punjab called the price "woefully inadequate and unjustified." I don't blame him, that is the smallest price increase in the last four years, at a time when the government are supposed to be encouraging increased winter wheat plantings, following sharp production losses in summer rice output after the worst monsoon season in 37 years.
The government's stance, and the archaic Indian infrastructure, leaves the nation now relying on Mother Nature not to deliver any further surprises this winter that could knock wheat output significantly.
After a year that's seen Indian lives and crops wiped out by drought and floods, who'd like to bet on that?
The recently announced auction of 500,000 MT has met with a muted response as the minimum tender prices were well above the prevailing market levels. They are now said to be "considering" reducing the asking prices slightly at a meeting next week.
Tenders were invited at prices ranging from close to Rs 1,400/100kg in the north to almost Rs 1,800/110kg in the south. That's a hefty return on the Rs 1,080/100kg that the government paid for the wheat back in March/April, and appears to do little to help achieve their stated aim of reeling in food price inflation. To me it looks more like profiteering.
Today the government have announced an increase on the minimum support price it will pay the nation's impoverished farmers for new crop wheat for 2010. Their decision to increase the MSP by just 1.85% to Rs 1,100/100kg has also met with fierce criticism.
The chief minister of Punjab called the price "woefully inadequate and unjustified." I don't blame him, that is the smallest price increase in the last four years, at a time when the government are supposed to be encouraging increased winter wheat plantings, following sharp production losses in summer rice output after the worst monsoon season in 37 years.
The government's stance, and the archaic Indian infrastructure, leaves the nation now relying on Mother Nature not to deliver any further surprises this winter that could knock wheat output significantly.
After a year that's seen Indian lives and crops wiped out by drought and floods, who'd like to bet on that?
