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Wheat procurement may cross 22 mt

Surinder Sud

The total wheat procurement this year might exceed 22 million tonnes, against last year's 20.6 million tonnes. The overall wheat output is also expected to be far better this year, over 73.5 million tonnes, against last year's 68.7 million tonnes.

Despite the rabi grain marketing season being at its peak with an unusually brisk harvesting this year, the private trade is conspicuously absent from the wheat mandis in the wheat heartland of Punjab and Haryana. The public grain procurement agencies, including the Food Corporation of India, are purchasing most of the wheat being brought to the market by farmers.

According to the latest figures available with the FCI, a record 9.54 million tonnes of wheat from the fresh crop has already arrived in the mandis. Of which, nearly 9.3 million tonnes, or about 97 per cent, has been mopped up by FCI and state grain purchasing agencies.

Consequently, the country's foodgrain stocks, which had shown some decline due to increased offtake for domestic consumption and exports, are likely to swell again to around 75 million tonnes by the end of the main wheat procurement season next month.

Though the Union Budget has set apart Rs 211.90 billion for food subsidy, including the buffer carrying cost of Rs 83.39 billion, the actual spending on both these counts may far exceed these levels, it is feared.

The private trade is reported to have picked up only small quantities of wheat from the markets in Madhya Pradesh and Rajasthan. But in the largest wheat surplus states of Punjab and Haryana, the traders have virtually not entered the market at all.

Even wheat exporters are not buying grain, despite wheat exports having picked up substantially in the past year, making India the seventh largest wheat exporter in the world.

Trade circles are attributing their irrelevance in wheat marketing to the present state-trading dominated foodgrain management policy. "When the government is prepared to buy at a higher cost and subsequently sell it to the traders and exporters at lower than cost price, why should the traders block their money in buying, storing and selling wheat," a representative of the traders pointed out.

Analysts attribute the early and rather heavy market arrivals to two factors. The rise in temperature to above-normal levels in the northern wheat belt since the first week of April led to quicker ripening of the grain.

Besides, the constant threat of sudden showers and consequential damage to the mature crop prompted farmers to hasten harvesting.

However, the quality of the grain, especially sheen and weight, is said to have been marginally affected due to hastened ripening in the early summer.

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