Wheat seed prices up over 10% as farmers look to cover more area

Prices of wheat seeds have increased by over 10 per cent this year as more farmers are looking to sow the cereal in view of a bullish market.

“Wheat seeds are selling above ₹3,500 a quintal against around ₹2,700-2750 last year. Breeder seeds from universities are costing around ₹7,000,” said Sunil Mukhati, a farmer from Dewas in Madhya Pradesh.  A farmer requires 50-60 kg of wheat seed per acre.   

“Wheat seed prices are soaring at ₹4,100 in some places. This is far higher than last year,” said Delhi-based exporter Rajesh Paharia Jain.

Export demand

Wheat seeds are in demand mainly since the cereal’s prices are ruling at a record high currently. Last week, the weighted average price of wheat at agricultural produce marketing committee (APMC) yards across the country increased to ₹2,617.92 a quintal against ₹2,612.26 the previous week.

During the same period a year ago, the cereal’s price was ₹2,123.36. Wheat prices have been ruling above the minimum support price (MSP) of ₹2,015 since harvest began in March as exporters scoured for stocks to meet the demand abroad following the Ukraine war.

The global market turned towards India for wheat as Russia and Ukraine, which are engaged in a war since February, meet 30 per cent of the demand. However, with the Indian crop being affected by a heatwave and procurement by the Food Corporation of India dropping by 57 per cent to 18.79 million tonnes, the Centre banned the cereal’s exports. 

 “Wheat prices are higher since the Centre has stopped its supply through the Prime Minister Garib Kalyan Anna Yojana (PMGKAY), discontinued the sale of wheat through the open market sale scheme (OMSS) and supplies have been affected due to low production this year,” said Sandeep Bansal, Director of Kanpur-based Grain Flour India Pvt Ltd.

70% rise in open market

The stoppage of supply through PMGKAY has forced beneficiaries of the scheme to buy from the open market, while the OMSS ensured users such as flour mills got surplus wheat from the Food Corporation of India (FCI) at a pre-determined price. 

“Prices in the open market have increased by over 70 per cent since June 2021, when wheat prices were ruling at ₹1,500 a quintal. This has resulted in farmers showing interest in planting more wheat. Therefore, there is a good demand for wheat seed,” Bansal said. 

Trade sources said Maharashtra farmers are looking to sow more wheat, switching over from gram (chana). According to data from the Agriculture Ministry, wheat sowing increased by over four times for the week-ended November 4 to 7.67 lakh hectares. 

Early sowing

Farmers in Rajasthan, Uttar Pradesh and Madhya Pradesh are the ones showing more interest in growing wheat, opting to sow earlier so that they can overcome any adverse weather impact. Experts feel early sowing will help them manage any heatwave impact and avoid a repeat of this year’s experience.

This year, a heatwave swept across the country during March-April affecting wheat production. Initially estimated at a record 111.34 million tonnes (mt), it had to be lowered to 106.84 mt. The trade, however, thinks the crop could be even lower.

“Farmers in our region are planting more wheat this year in view of the good prices,” said Mukhati. 

Wheat prices are expected to rule firm over the next few months across the world as sowing has been affected in Russia and Ukraine. Currently, benchmark wheat futures on the Chicago Board of Trade are ruling at $8.43 a bushel ($309.86 a tonne). This is against a record high of $12.8 in May, soon after India banned the foodgrain’s exports. 

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