Centre ready to tweak e-auctions for sale of rice through open market

Defending the poor response from small traders for rice under the Open Market Sale Scheme (OMSS) in the first e-auction round, the Centre on Monday said this is initial stage and it expect good response in coming days as auction will continue for nine months.

The Food Corporation of India (FCI) just started e-auctions. Though the FCI has been doing auction for wheat, this is first time, it was doing rice. Since e-auction has got lukewarm response from traders from many states, the government will discuss and will tweak the existing policy if required in future, Union Food Secretary Sanjeev Chopra told media here.

While ruling out allowing states to participate in the OMSS for rice, Chopra also said the Centre will watch how the subsequent e-auction rounds go before deciding on the next course of action.

Also Read | Karnataka hit as Centre stops rice, wheat sale under OMSS to control price rise

Insisting that the OMSS for rice has been started after many years and this has been done to give signal to market against any artificial price rise in retail market.

In the first round of e-auction held on July 5, the Food Corporation of India (FCI) had offered 3.88 lakh tonne of rice but only 170 tonne was sold to five bidders. The next auction is scheduled on July 12.

The sale of rice under the OMSS has not ended. It will be continued until March 31, 2024 and sale will happen via e-auction every week, he added.

The Secretary also mentioned that the small traders were not aware of the OMSS rice sale. The FCI is doing publicity of the same and the government expects more participation in the coming coming rounds of e-auction.

The sale of rice via OMSS was started to improve availability and check rise in retail prices amid shortage of rice stock by 13 per cent vis-a-vis past two years and possibility of El Nino leading to weather disruptions likely affecting the rice production and procurement, he added.

According to FCI Chairman and Managing Director Ashok Kumar Meena, the offtake of rice under the OMSS was less as the e-auction norms have been tightened to ensure small traders are able to participate.

Ruling out allowing states to participate in the Open Market Sale Scheme (OMSS) for rice as sought by Karnataka government, the Secretary said about 360 lakh tonne of grain is required to meet the demand under the Pradhan Mantri Garib Kalyan Ann Yojana (PMGKAY) at present.

Congress-ruled Karnataka and the Centre have locked horns over the OMSS rice, with the latter maintaining that it does not have enough stocks to meet the demand if all states start seeking rice from the central buffer stock.

The FCI earlier announced to sell 4 lakh tonnes of wheat and 5 lakh tonnes of rice from buffer stock to bulk consumers and traders to control rising retail prices of these two foodgrains.

The FCI, the government's nodal agency for procurement and distribution of foodgrains, conducted e-auction of wheat on June 28 and that of rice on July 5 to boost domestic supplies and control prices through OMSS.