{"id":325085,"date":"2025-01-29T20:27:58","date_gmt":"2025-01-29T14:57:58","guid":{"rendered":"https:\/\/forumias.com\/blog\/?p=325085"},"modified":"2025-01-29T20:27:58","modified_gmt":"2025-01-29T14:57:58","slug":"wheat-prices-are-rising-despite-government-efforts","status":"publish","type":"post","link":"https:\/\/forumias.com\/blog\/wheat-prices-are-rising-despite-government-efforts\/","title":{"rendered":"Wheat prices are rising despite government efforts"},"content":{"rendered":"

Source<\/strong>: The post Wheat prices are rising despite government efforts has been created, based on the article \u201cGRAINY PICTURE: Several questions arise from the recent trend of wheat prices<\/strong>\u201d published in \u201cBusiness Standard<\/strong>\u201d on 29th January 2025<\/p>\n

UPSC Syllabus Topic:<\/strong> GS Paper3-Public Distribution System- objectives, functioning, limitations, revamping; issues of buffer stocks and food security<\/p>\n

Context<\/strong>: The article discusses rising wheat prices despite government market interventions. It highlights speculative activity, weather concerns, and subsidy burdens. It also examines food stock levels, the impact of free grain distribution, and debates on revising the public distribution system amid poverty decline.<\/p>\n

Why Are Wheat Prices Rising Despite Government Intervention?<\/strong><\/h2>\n
    \n
  1. Wheat prices in Delhi reached \u20b93,360 per quintal, even though the government released large stocks through the Open Market Sale Scheme (OMSS)<\/strong>.<\/li>\n
  2. In FY24, 10 million tonnes of wheat<\/strong> were pumped into the market to cool prices.<\/li>\n
  3. However, in November 2023, only 2.5 million tonnes<\/strong> were allocated, and about 1.76 million tonnes were sold<\/strong>. Despite this, wheat prices rose by <\/strong>\u20b9<\/strong>150 per quintal<\/strong> in Delhi.<\/li>\n
  4. Low stocks with flour millers and biscuit makers<\/strong> \u2013 They have limited supplies and need more wheat.<\/li>\n
  5. Speculative activity<\/strong> \u2013 Traders are hoarding wheat, expecting further price increases.<\/li>\n
  6. High auction prices<\/strong> \u2013 The reserve price was <\/strong>\u20b9<\/strong>2,325 per quintal<\/strong>, but actual auction prices were much higher, showing high demand.<\/li>\n<\/ol>\n

    Is Weather a Concern for the Wheat Crop?<\/strong><\/h2>\n
      \n
    1. A sharp rise in day temperatures<\/strong> in North India raised concerns about wheat crops.<\/li>\n
    2. Scientists say night temperatures remain normal<\/strong>, keeping the 24-hour average at 15-16\u00b0C<\/strong>, which is ideal<\/strong> for wheat growth.<\/li>\n
    3. However, if night temperatures rise<\/strong>, wheat crops could be affected.<\/li>\n<\/ol>\n

      How Are Government Food Subsidies Impacting Wheat Stocks?<\/strong><\/h2>\n
        \n
      1. The government provides free wheat and rice<\/strong> to 800 million people<\/strong> under Pradhan Mantri Gareeb Kalyan Ann Yojana (PMGKAY)<\/strong> until FY29<\/strong>.<\/li>\n
      2. 74%<\/strong> of the \u20b9<\/strong>205,250 crore<\/strong> food subsidy budget was spent by November 2024<\/strong>, compared to 58% last year<\/strong>.<\/li>\n
      3. Wheat stocks were 18.41 million tonnes<\/strong> in January 2025<\/strong>, slightly above 16.35 million tonnes<\/strong> last year.<\/li>\n
      4. Higher auction prices<\/strong> than the \u20b9<\/strong>2,325 per quintal reserve price<\/strong> indicate unsatiated demand<\/strong>.<\/li>\n
      5. Food subsidy overspending may exceed budget estimates<\/strong> if spending continues at the same rate.<\/li>\n<\/ol>\n

        What Are the Key Takeaways?<\/strong><\/h2>\n
          \n
        1. Wheat prices are rising despite record production (113.29 million tonnes in 2023-24).<\/strong><\/li>\n
        2. Market demand, speculation, and weather concerns contribute to price hikes.<\/strong><\/li>\n
        3. Food subsidies are putting pressure on government finances.<\/strong><\/li>\n
        4. Experts suggest reforming PDS and adjusting food subsidy policies.<\/strong><\/li>\n
        5. India\u2019s poverty has declined, but millions still struggle with low incomes.<\/strong><\/li>\n<\/ol>\n

          Question for practice:<\/strong><\/p>\n

          Discuss the reasons behind rising wheat prices despite government interventions and the impact of food subsidies on wheat stocks.<\/p>\n","protected":false},"excerpt":{"rendered":"

          Source: The post Wheat prices are rising despite government efforts has been created, based on the article \u201cGRAINY PICTURE: Several questions arise from the recent trend of wheat prices\u201d published in \u201cBusiness Standard\u201d on 29th January 2025 UPSC Syllabus Topic: GS Paper3-Public Distribution System- objectives, functioning, limitations, revamping; issues of buffer stocks and food security… Continue reading Wheat prices are rising despite government efforts<\/span><\/a><\/p>\n","protected":false},"author":10320,"featured_media":0,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[1230],"tags":[10503,216,8184],"class_list":["post-325085","post","type-post","status-publish","format-standard","hentry","category-9-pm-daily-articles","tag-business-standard","tag-gs-paper-3","tag-indian-economy","entry"],"jetpack_featured_media_url":"","views":"","jetpack_sharing_enabled":true,"_links":{"self":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/325085","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/users\/10320"}],"replies":[{"embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/comments?post=325085"}],"version-history":[{"count":0,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/posts\/325085\/revisions"}],"wp:attachment":[{"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/media?parent=325085"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/categories?post=325085"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/forumias.com\/blog\/wp-json\/wp\/v2\/tags?post=325085"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}