BUFFER STOCK
FCI wheat procurement hits 26.6 mn tn, surpassing last year's purchase
The government's robust procurement efforts, exceeding targets in wheat and paddy, have significantly bolstered food security. FCI's strong storage infrastructure ensures the maintenance of adequate food supplies, benefitting millions of farmers across the country.
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So-called buffer or risk-managed ETFs help maximize returns from an asset for investors and simultaneously provide downside protection over a specific period. Buffer ETFs also typically see lower redemption requests during times of heavy market volatility.
As FCI buffer swells, exporters demand lifting of curbs on rice
The retail and wholesale inflation in rice has been in double digits since last year. India, the largest exporter of rice, banned export of broken rice in August 2022 to ensure adequate local supplies. This was followed by a ban on export of non-basmati white rice in July 2023, imposition of a 20% export duty on parboiled rice in August 2023 and restrictions on basmati rice by imposing a minimum export price.
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Stocks to buy: Out of 304 companies, where estimates are compiled by a minimum of three analysts through Reuters-Refinitiv, 50 stocks have consistently surpassed analysts’ net profit estimates in all four quarters of 2023-24. This group of 50 stocks has delivered an average return of 72.4% over the past year, compared to the BSE 500 index’s 38% return over the same period. This data is based on closing values as of 18 June. The article explores the five companies that have been covered by a significant number of analysts and currently offer double-digit share price potential.
Govt buys 71,000 tonnes of onion for buffer stock; expects retail prices to ease with normal monsoon
The Indian government has procured nearly 71,000 tonnes of onion this year for buffer stock, out of a total target of 5 lakh tonnes for price stabilisation. The all-India average onion retail price is Rs 38.67 per kg, while the modal price is Rs 40 per kg. The government is on course to achieve targeted procurement of 5 lakh tonnes for price stabilisation. The procurement price is dynamic and linked to prevailing market prices.
Export duty on onions to stay as domestic prices recover
India's central government is unlikely to remove the 40% export duty on onions imposed last month, as domestic onion prices have almost doubled in the last month. The average rate of onions at the benchmark Lasalgaon APMC was Rs 28/kg on Tuesday, up 40% in the last 15 days and double of what it was a month ago. The rising onion prices have slowed down the pace of government onion procurement operations to create a strategic reserve under the Price Stabilisation Fund.
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Onion buffer stock not even 10% of FY25 target
Government's procurement of onions for buffer stock creation for price stabilisation operations falls short of 2024-25 target by 90%. Delay attributed to elections and low purchase rates deterring farmers.
Normal southwest monsoon augurs well for food production, easing price pressures, says FinMin in monthly review
In its review, the Finance Ministry also reiterated its faith in India's ability to deal with adverse pressures from geopolitical tensions, while continuing to make progress on its growth numbers. "The positive indications in the farm sector should help India firewall against any adverse pressures that may arise from geopolitical tensions and global commodity prices," the review from the Finance Ministry said.
Govt plans big scale radiation processing of onions to prevent shortages
Government plans to irradiate onions to create a 1,00,000-tonne buffer stock amidst a projected 16% output decline. Radiation aims to extend shelf life, curb price volatility. Fifty irradiation centers identified near consumption areas; NAFED and NCCF tasked with procurement. Controlled atmosphere storage at railway hubs considered for quicker transportation.
India exports over 45,000 tonnes onion after lifting ban
India exported 45,000+ tonnes of onions post-ban lift, easing farmer woes. Nidhi Khare, Secretary, noted major exports to Middle East, Bangladesh. Govt has set minimum export price for onion. Monsoon forecast ensures good kharif crop sowing, buffer stock building.
Wheat processors calls for removal of import duty to ease supply shortage
The wheat processing industry is urging the removal of the 40% import duty on wheat to address the shortage in the local market. With government procurement falling behind targets and carry-forward stocks at a 16-year low, industry representatives argue that eliminating the duty would facilitate imports, bolster buffer stocks, and stabilize wheat prices. International wheat prices have surged by over 15% in the last 10 days, making it financially viable for some mills in South India to import wheat if the duty is lifted.
Govt buys 196 lakh tonne wheat so far, higher than annual demand of 186 lakh ton for welfare schemes
Government exceeds wheat procurement target for welfare schemes, focusing on buffer stocks and open market intervention. Lower purchases in Madhya Pradesh and Punjab. Food Corporation of India strives for 310-320 lakh tonne procurement to stabilize prices.
Disclosure of pulses stock mandatory from April 15
Consumer Affairs Secretary Nidhi Khare will meet pulses traders, representatives of various government departments such as customs and state government representatives in separate meetings to discuss measures for bringing imported pulses, which are lying in customs warehouses, to the market. ET had reported that the government is planning to make it mandatory for pulses traders and retailers to disclose stocks of yellow peas (matar), tur (pigeon peas) and urad as prices in some markets show an increasing trend in its April 5 edition.
Taiwan earthquake likely to have minimal impact on global electronics supply chain, Indian market remains stable
The 7.4 magnitude earthquake in Taiwan, which caused widespread disruption in chip fabrication plants, is likely to have minimal impact on the global value chain in electronics manufacturing, including India. Industry executives and market trackers do not expect any adverse impact on prices or supply chains of mobile phones and other electronics items in India, which heavily relies on the Southeast Asian island nation for components.
Wheat stock declaration requirement extended indefinitely
The Indian government has indefinitely extended the requirement for the wheat industry to declare their stock positions, which was initially set to expire on March 31. Traders, wholesalers, retailers, and processors are mandated to declare their stocks on a portal every Friday starting from April 1 until further notice.
Private companies may have to let government buy wheat first
Private wheat industry and trade are eyeing Uttar Pradesh, currently the source of the cheapest wheat in India, as the central government's wheat stock is expected to fall below the buffer norm on April 1 for the first time in over a decade. However, they may have to wait before refilling their silos until the government meets its procurement targets. The government has signaled to the industry not to hoard wheat during the arrival season to allow for procurement. While the new crop will start arriving in April, larger volumes are expected after mid-April.
Wheat stock with Food Corporation of India falls below 100 lakh tonnes for the first time since 2018
The Food Corporation of India (FCI) has reported a decrease in wheat stocks, falling below 100 lakh tonnes for the first time since 2018. However, rice stocks held by FCI currently exceed four times the buffer norm. Despite the drop in wheat stocks, the current level remains above the statutory buffer stock requirement. FCI anticipates a notable improvement in wheat procurement this year.
'Centre plans to procure five lakh tonnes of onions this year for buffer stock'
The government's plan to create buffer stock comes amid an estimated fall in onion output in 2023-24. "Production of onion in 2023-24 is expected to be around 254.73 lakh tonnes compared to around 302.08 lakh tonnes last year due to a decrease of 34.31 lakh tonnes in Maharashtra, 9.95 lakh tonnes in Karnataka, 3.54 lakh tonnes in Andhra Pradesh and 3.12 lakh tonnes in Rajasthan," the agriculture ministry said in a statement on Thursday.
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Strong US economic outlook buffers stocks against rising yields -Goldman
A strong economic outlook is helping U.S. stocks weather a rise in Treasury yields, though that could change if factors such as tighter monetary policy drive yields higher or if they move up too fast, Goldman Sachs strategists said.
Govt procures 25,000 tonnes of kharif onion so far for buffer stock
The government has raised the buffer stock target to 7 lakh tonnes for the 2023-24 fiscal, against the actual stock of 3 lakh tonnes last year. According to the Secretary, the government had procured 5 lakh tonnes from last year's rabi season and is purchasing 2 lakh tonnes of kharif onion as the buffer stock target has been raised.
Govt assures onion farmers there won't be export ban impact; will buy 2 lakh tonne for buffer stock
On December 8, the Centre banned onion exports till March 31 next year to increase domestic availability and keep prices under check. This has led to protests by onion farmers in Maharashtra's Nashik district.
Where to look for pockets of value in a super bullish market? Mihir Vora explains
“For India, it is a good situation to be in where you have moderating global interest rates, a not so strong dollar, and not a crashing global economy. Inherent strength of domestic consumption should carry us through. Plus, the capex cycle which is just picking up should see us through the next two to three years.”
Govt sells 2.84 lakh tonnes of wheat, 5,830 tonnes of rice from buffer stock to check retail prices
The Centre has said that 2.84 lakh tonnes of wheat and 5,830 tonnes of rice were sold from its buffer stock to over two thousand bidders through an e-auction. The move was aimed at controlling retail prices by offloading food grains in the open market. Weekly e-auctions of wheat and rice are done by the government to control retail prices.
Indian government continues to purchase Canada lentils for buffer stock
The Indian government is continuing to purchase lentils from Canada despite the strained diplomatic relations between the two countries. This is part of India's efforts to build buffer stocks and stabilize the high prices of pulses. Two central government agencies have issued tenders to procure red lentils from the local market as well as through imports. The lentils must comply with the specifications of the Food Safety and Standards Authority of India. Despite the tensions, there have been no official restrictions on trade between the two countries.
Sale of wheat, rice to states under OMSS stopped to maintain adequate buffer stocks, control prices
India has discontinued wheat and rice sales to states via Open Market Sale Scheme (OMSS) in an effort to control inflationary trends and maintain adequate stock levels under the central pool after the expected shortfall in monsoon rains due to El Nino. The buffer stocks of wheat under the central pool is reportedly much higher than the buffer norms requirement.
Govt procures 3 lakh tonnes of onion for buffer stock; 20% higher than last year
The government has procured 3 lakh tonnes of onions, a 20% increase from last year's buffer stock, and is experimenting with the irradiation of onions with the Bhabha Atomic Research Centre (BARC) to extend shelf life, according to Consumer Affairs Secretary Rohit Kumar Singh.
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