Wheat prices could see a downward movement on the back of improved market sentiment, following the government's decision to allow the private sector to import wheat at a low Customs duty rate of 5 per cent, a leading industry body has said. | |
| The decision would also bring down prices in the futures market, Roller Flour Millers' Federation President Prem Gupta said. |
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| "The decision to allow biscuit and bread manufacturers and flour millers will help bring down the wheat price level," he said. |
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| Gupta said the decision of NCDEX to bring down the maximum margin limit for wheat futures by .5 per cent would also improve market sentiment. |
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| The state trading corporation (STC) has awarded contracts for 22-lakh tonne wheat imports to five global trading companies and supplies are expected in the next two-to-three months, Gupta said, adding that "This would also remove psychological pressure about artificial shortages." |
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| He, however, said the market sentiment would have been much better had the government allowed duty-free wheat import. The 5-per cent duty on wheat import would mean there would have been a difference of Rs 45 per quintal had the wheat imports been allowed duty free, a trader said. |
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| The government should have permitted duty-free wheat import, said DP Singh, chairman of the All India Grain Exporters Association. |
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| "The 5-per cent duty on wheat import would not have the same kind of impact on the price as duty-free import would have had on market price level," he said. |
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