December 14, 2023
Indian government to procure more wheat stocks locally
In a bid to address significantly lower wheat procurement in the Indian states of Uttar Pradesh, Bihar, and Rajasthan during the previous rabi season, the Indian government is gearing up to enhance wheat procurement in Uttar Pradesh and Bihar for the upcoming 2024-25 winter crops season, Mint reported.
In the last season, the governments of Uttar Pradesh and Bihar fell short of their targets, procuring 214,981 tonnes and 589 tonnes of wheat, respectively, against set targets of 3.5 million tonnes and 1 million tonnes.
As part of the strategy, India's National Agricultural Cooperative Marketing Federation of India (NAFED), alongside state agencies and the Food Corporation of India (FCI), will play a role in wheat procurement. A senior official disclosed that a letter has been issued to NAFED for wheat procurement in these states at the minimum support price (MSP), and a draft action plan has been submitted for finalisation.
The government plans to analyse district-wise wheat production, its market arrival, and procurement, identifying areas for targeted procurement and allocation of central or state agencies. The aim is to ensure early farmers' registration and an early start of procurement, beginning in mid-January in districts with early arrivals due to shifts in cropping practices influenced by climate change.
The official stated that a review of the performance of agencies engaged in procurement in previous years will be conducted. Agencies may also provide non-financial assistance, such as facilitating farmers' registration.
The previous season witnessed a slowdown in wheat procurement in Rajasthan, Uttar Pradesh, and Bihar due to falling market arrivals. Farmers were enticed by better prices offered by traders and millers in the market, rather than selling to the government at MSP. For the 2023-24 winter crops season, the government could purchase 26.1 million tonnes against the estimated target of 34.1 million tonnes.
Despite a seven-year low of 18.5 million tonnes of wheat in the central pool against the buffer norm of 13.8 million tonnes as of January 1, the government aims to proactively manage food prices. Farmers have commenced wheat cultivation, and the government has implemented measures such as open market sales, export bans, and stock holding limits on wheat to stabilise prices of food items.
- Mint
