Reliance Retail's bid price for 40,000 T Haryana wheat signals shortage

Reliance Retail has won a bid to buy 40,000 tonnes of wheat from Haryana State Cooperative Supply and Marketing Federation (Hafed) at ₹24,200 a tonne, officials at the cooperative body said on Wednesday.

Hafed, which used to procure wheat only for Food Corporation of India at the minimum support price, had for the first time purchased the grain at market rate this year for the sole purpose of exports. It had procured 1,80,000 tonnes of wheat, paying more than the MSP for exports. However, after the Centre put a break on wheat exports in May, the cooperative body started offering wheat to domestic buyers.

Hafed is known to work for profit. It had bought this export-quality wheat at market rate from Haryana and Madhya Pradesh, competing with the private sector. The total tendered quantity was 1,04,268 tonnes, of which more than 60,000 tonnes were from Madhya Pradesh and 40,000 tonnes from Haryana. Hafed officials said they were most likely to accept the Reliance Retail bid for the entire 40,000 tonnes of Haryana-origin wheat.

According to traders, the Hafed sale has given a strong signal that there is a shortage of wheat in the market and that prices will remain firm.

For the remaining more than 60,000 tonnes of wheat of MP origin on offer, Hafed has decided to go for re-tendering. "Our objective is to stabilise market prices," said Hafed managing director A Srinivas.

"Our cost of wheat purchase is higher in Madhya Pradesh than that in Haryana as we had to compete with big exporters," said RP Sahni, chief general manager, Hafed.

As FCI is not likely to sell wheat under the open market sales scheme, apart from the private trade, the only agency having wheat for open market sale is Hafed.