Commodity Outlook – Wheat

Sowing period: October
Harvesting period: April to May
Crop season: Rabi

Key growing locations:

  1. Madhya Pradesh – Ujjain, Ratlam, Dhar, Sehore, Indore
  2. Rajasthan – Kota, Baran, Chittorgarh, Bundi, Jhalawar
  3. Uttar Pradesh – Kanpur, Varanasi, Agra, Bahraich, Hardoi
  4. Maharashtra – Mumbai, Vashim, Dhule, Akola, Nandurbar
  5. Gujarat -Rajkot, Sabarkantha, Dahod, Junagarh, Ahmedabad

Production trend and Stock position:

  • According to Ministry of Agriculture, the sowing acreage of Wheat as on January 8, 2021 was 335.46 lakh hectares (lh) up by 2.67 percent compared to 326.75 lh during the corresponding period.
  • According to Department of Food & Public Distribution the government had sold 92,480 MT of Wheat in open market sale scheme (OMSS) through e-Auctions in December 2020 and till now no rakes have been sold or any by any state Government.
  • According to Directorate General of Commercial Intelligence and Statistics (DGCIS) India’s overall export of Wheat from April to October 2020 was 5.11 lakh metric tonnes (LMT) valued at ₹ 1,002.90 crores.
  • The top five countries India exported its Wheat from April to October 2020 were Nepal, Bangladesh, Afghanistan, UAE and Sri Lanka.

Monsoon Update

For the country as a whole, cumulative rainfall during this year’s winter season till January 13, 2021 is above Long Period Average (LPA) by 171 percent. Details of the rainfall distribution over the four broad geographical regions of India are given below:

Note: Markets are currently in Backwardation where the Spot market prices are higher than the Futures market prices.

Market commentary: Price outlook

  • Wheat prices are likely to trade steady to slightly firm in the immediate / short term due to high export demand.
  • The Government had increased the Minimum Support Price (MSP) of Wheat by 2.60 percent to ₹ 1,975 per quintal for marketing season 2021-22 compared to ₹ 1,925 in 2020-21.

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