Context: 

The Centre has discontinued the sale of rice and wheat from the central pool under the Open Market Sale Scheme (OMSS) to State governments, a move that will hit some States, including Karnataka, offering free grains to the poor.

Reason behind discontinuation: 

• As per the Food Ministry, in order to ensure that the inflationary trends are kept under control while ensuring adequate stock levels in the central pool, it has been decided to exclude State governments’ scheme from the ambit of OMSS.

About Open Market Sale Scheme (Domestic):

• The OMSS is operationalised to sell foodgrains, especially wheat and rice, at predetermined prices in the open market from time to time to bulk consumers and private traders during the lean season.
• Nodal Agency: Food Corporation of India (FCI)
• Mode of Selling: Weekly auctions by FCI on the platform of the National Commodity and Derivatives Exchange Limited (NCDEX).
• Purpose: To improve domestic availability of these two key grains and cool down open market prices, especially in deficit regions.
• Quantity allowed in a bidding:
  • The quantity that a bidder can purchase in a single bid range from 10-100 tonne. 
  • Earlier, the maximum quantity allowed was 3,000 tonnes per bid for a buyer.
• Reason behind reduction in quantity: 
  • To accommodate more small and marginal buyers and to ensure a wider reach of the scheme.
  • To facilitate the release of stocks sold under OMSS (D) to reach the general public immediately.

News Source: The Hindu