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Open Market Sale Scheme (OMSS)


The Central Government recently discontinued the sale of rice and wheat from the central pool under the Open Market Sale Scheme (OMSS) to State governments.


GS III: Agriculture

Dimensions of the Article:

  1. Open Market Sale Scheme (OMSS)
  2. About the Food Corporation of India (FCI)

Open Market Sale Scheme (OMSS):

  • The objective of the Open Market Sale Scheme (OMSS) is to enhance the supply of food grains, specifically wheat, during the lean season and moderate open market prices, especially in deficit regions.
  • The Food Corporation of India (FCI) conducts weekly auctions through e-auctions in the open market to sell surplus stocks of wheat and rice.
  • The auctions are conducted using the platform of the National Commodity and Derivatives Exchange Limited (NCDEX).
  • State Governments and Union Territory Administrations have the option to participate in the e-auction if they require wheat and rice outside the Targeted Public Distribution Scheme (TPDS) and Other Welfare Schemes (OWS).
Reserve Price and Bidding:
  • The government sets a reserve price for the auction.
  • Bidders participating in the tenders floated by the FCI cannot quote a price less than the reserve price.
Types of OMSS Schemes:

The present form of OMSS consists of three schemes:

  • Sale of wheat to bulk consumers/private traders through e-auction.
  • Sale of wheat to bulk consumers/private traders through e-auction by dedicated movement.
  • Sale of Raw Rice Grade ‘A’ to bulk consumers/private traders through e-auction.

About the Food Corporation of India (FCI):

  • FCI is a statutory body established in 1965 under the Food Corporation Act, 1964.
  • It was created in response to a major shortage of grains, particularly wheat, in the country.
  • FCI operates under the ownership of the Ministry of Consumer Affairs, Food and Public Distribution, Government of India.
  • The headquarters of FCI is located in New Delhi.
Objectives of FCI:
  • Provide effective price support to farmers.
  • Procure and supply grains to the Public Distribution System (PDS) for distributing subsidized staples to economically vulnerable sections of society.
  • Maintain a strategic reserve to stabilize markets for basic food grains.

-Source: The Hindu

December 2023