April 3, 2007

India begins wheat procurement
 

The government of India has started its wheat procurement operations in Punjab and Haryana, but traders believe it may not be able to purchase in both the states till the next week due to low arrivals and high open market prices. 

In Karnal, one of the key wheat markets in Haryana, the new crop arrivals are being dominated up by the private sector who buys the food grain at Rs 855-891 a quintal, higher than the government's support price of Rs 850. 

A Karnal-based dealer said prices quoted for the new crop are high as arrivals have been very low so far. Only 200 bags (1 bag = 100 kg) of new wheat arrived in Karnal today. He said arrivals are expected to gather steam only by next week. 

According to a dealer, once arrivals gain steam, open market prices should fall to about Rs850 a quintal to enable the government to procure at that price. 
 

A dealer said the crop in Khanna, Punjab is yet to be harvested as the moisture content in the standing crop is still high due to the late rains. 

He said the wheat harvests are likely to pick up by next week in most parts of Haryana and by mid-April in Punjab. 

About 90 per cent of the total wheat procured by the government comes from Punjab and Haryana. 

The government hopes to procure 12 to 15 million tonnes wheat this year as against last year's 9.2 million tonnes.