Govt cuts rice price under open market sales to ₹29 a kg

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₹2 per kg to ₹29 per kg under the Open Market Sale Scheme (OMSS). The move comes amid few takers for the food grain at ₹31 a kg. The Food Corp.

of India (FCI), in today’s e-auction, sold 1,500 tonne of rice. It has sold a total of 495 tonne of the food grain against nearly 1.4 million tonne offered in the previous five e-auctions since 5 July. “Keeping in view the experience of the past five e-auctions for rice by FCI, it has been decided that the reserve price will be brought down by ₹200 a quintal and the effective price now will be ₹2,900 per quintal," food secretary Sanjeev Chopra said.

“The cost on account of reduction in the reserve price will be borne from the Price Stabilization Fund (PSF) maintained by the Department of Consumer Affairs." Rice offered under OMSS comprises about 25% broken grain and is costlier than market prices of ₹28-29 a kg, including export cost (until exports of white rice were not restricted) which made it unattractive for traders. As a result, there were few takers for the food grain, according to trade experts. The government has decided to offload 500,000 tonne of wheat and 2.5 million tonne of rice in the open market through OMSS.

This is over and above 1.5 million tonne of wheat and 500,000 tonne of rice sales announced under the OMSS on 28 June. Since 28 June, the government has so far sold 821,000 tonne of wheat against 1.75 million tonne offered. So far, seven e-auctions have taken place.

Average bid price for wheat under OMSS on Wednesday was ₹2,254.71 a quintal against the reserve price of ₹2,129.17. In the case of rice, the average bid price was ₹3,163.53 per quintal against the reserve price of ₹3,162.03. The reserve price of wheat has been kept unchanged.