Govt may sell wheat/rice in open market at cheaper rates

The Union Government may reduce the price of wheat and rice it plans to sell in the open market to check food inflation, after an earlier sale received poor response possibly due to high rates quoted by it.

The Centre has decided to offload up to 30 lakh tonnes of wheat and rice from its reserves to check prices in the market. However, offtake under the Open Market Sale Scheme (OMSS) has been very low.

"The discussion is going on ... There is a Cabinet sub-committee on food (the Empowered Group of Ministers) and they have to take a final decision on reducing the prices and releasing more quantity," Minister of State for Agriculture K V Thomas said today, replying to a query whether the government plans to cut the rates of foodgrains under OMSS.

"I can't say now (as to) how much the price will be reduced," he said on the sidelines of a CII function here.

Food inflation was 17.47 per cent in the third week of November.

Interestingly, Food and Agriculture Minister Sharad Pawar had yesterday ruled out lowering the prices of foodgrains under OMSS. Last month, an Empowered Group of Ministers too had also decided against such a move.

At present, the Centre has fixed variable prices for every state and each month. For instance, in Punjab and Haryana the price of wheat to be sold in the current month has been fixed at Rs 14.23 a kg, higher than the current market price.