Wheat futures are likely to witness some from higher levels due to liquidation of government wheat in domestic market along with dearth of buying interest amongst millers and exporters. The NCDEX Wheat futures slumped by almost Rs 43 per quintal in the last week.

As per official sources, the Food Ministry is planning to sell additional 5 million tonne wheat in the open market to bulk consumers like flour millers and biscuit makers in order to upload spiraling domestic prices and also offloading the surplus stock at higher levels.

If the current wheat proposal approves by government then the total quantity of wheat to be sold would reach 8 million tonne in the current fiscal year. The base prices of the wheat will be Rs 1285 per quintal as decided by the government in August 2012. This will help the government to curb the domestic price escalation of wheat.

The spot prices of were trading in the range of Rs 1450-1600 per quintal in the major mandies of Uttar Pradesh and Gujarat , down almost Rs 50 per quintal in the last week.

Consequently, the NCDEX October Delivery pared Rs 43 per quintal in the last week to close at around Rs 1524 per quintal in the last week. Technically, prices are likely to witness some selling around Rs 1535-137 per quintal with the downside target of Rs 1510-1512 per quintal.

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