May 29, 2012

 

India's wheat buying expands to over 32 million tonnes

 

 

Boosted by high level output, the 2012 wheat procurement in India has increased to a record 32.6 million tonnes so far, even as key growing states of Punjab and Haryana are experiencing major drop in daily arrival of the crop.

 

Total wheat purchase in this marketing season (April- June) has already surpassed the government's target of 31.8 million tonnes and is expected to grow further as states like Madhya Pradesh and Uttar Pradesh still seeing daily crop arrival of up to 150,000 tonnes.

 

Punjab and Haryana, known as food bowls of the country, have contributed record 12.8 million tonnes and 8.6 million tonnes of the grain respectively this year.

 

However, the daily arrival of the crop has dried up to 16,500 tonnes in the two states, according to the data by Food Corporation of India (FCI), the nodal agency for procurement and distribution of foodgrains.

 

Punjab and Haryana had procured nearly 10.9 million tonnes and 6.92 million tonnes of wheat respectively in the previous season.

 

Wheat purchase in Madhya Pradesh stood 6.9 million tonnes this year while that in Uttar Pradesh was at 2.5 million tonnes this year.

 

FCI and other state agencies had procured about 24.8 million tonnes in the year-ago period. In the entire 2011-12, the procurement stood at 28.33 million tonnes.

 

Wheat production of India, the world's second-largest producer, is estimated at a record 90.23 million tonnes in the 2011-12 crop year (July-June). The minimum support price of wheat stands at Rs 1,285 per quintal.

 

The record purchase of wheat, however, has posed storage crisis for the government as it has capacity to store 62.8 million tonnes of foodgrains but the stocks are expected to swell to 75 million tonnes by end of this month.

 

To create space for fresh crop, the Rangarajan committee, last week had submitted a report to the Prime Minister suggesting offloading of 10 million tonnes of wheat to BPL and APL families and three million tonnes via open market sale.

 

The panel also suggested export of two million tonnes of wheat from the government godowns.