The government on Monday gave the rice sector instructions to quickly lower grain prices due to plentiful supply.
The food ministry announced reports of a sudden increase in margins received by wholesalers and retailers. This increase needs to be moderated. The announcement came after a meeting with members of the grain processing sector to discuss the domestic price picture of non-basmati rice.
‘The rice industry needs to ensure that the prices in the domestic market need to be brought down to optimal levels and efforts at ‘profiteering are dealt with strictly,’ according to a food ministry statement.
To safeguard consumers, the ministry suggests reducing the Maximum Retail Prices (MRP) if a significant gap exists with actual retail prices.
While discussing with rice millers, an official reported that despite a “good crop” this kharif, domestic rice prices are rising despite abundant stockpiles with the Food Corporation of India (FCI), and various levies and restrictions on grain exports.
FCI now has 18.24 million metric tonnes (MT) of rice in store, not counting the 29 MT that are owed to millers. As of January 1, the rice stock is below the 7.61 MT buffer.
November saw a little increase in retail rice prices of 11.81 per cent over the previous month. An official statement states that the rice yearly inflation rate is “a cause of concern” because it has been accumulating over the previous two years, averaging 12 per cent.
To boost local supply, the government has banned white rice exports and imposed a 20 per cent tax on parboiled rice.
In contrast to the yearly demand of about 40 MT for the Pradhan Mantri Garib Kalyan Anna Yojana, FCI acquired 56.9 MT of rice for the 2022–2023 season (October–September). The company hopes to acquire at least 55 MT of rice this season as well.
Nevertheless, since July, the company has only sold 0.11 MT of the rice in weekly auctions on the open market. Starting the next week, bulk purchasers will be able to bid on any amount of rice in a weekly e-auction, ranging from one to two thousand tonnes, in an effort to promote more OMSS sales.
