Wheat procurement starts on a tepid note

The government's wheat procurement in the ongoing rabi marketing season has started on a tepid note and total purchases this season could slip below last year's 25 million tonnes. Purchases so far are down 37 per cent compared to last season on slow arrivals in mandis. The government sells wheat at highly subsidised rates under various welfare schemes.

Food Corporation of India (FCI), along with state level agencies, had purchased 7.57 million tonnes wheat till April 21, compared to 11.96 million tonnes last year.  

FCI has projected a procurement of 31 million tonnes in the current season. However, Food Secretary Sudhir Kumar said that wheat procurement could slip below last year. He was speaking at an event in New Delhi on Tuesday.

Till date, 8.88 million tonne wheat has arrived in the major mandis of the country, down 31 per cent from 12.93 million tonnes in the corresponding period last year. Arrivals have been primarily hit in Punjab that accounts for maximum procurement. According to FCI data, arrival in Punjab was only 0.97 million tonnes against 4.32 million tonnes last year. Accordingly, procurement in the state also slipped to 0.94 million tonnes against 4.30 million tonnes.

Arrivals have been impacted due to the unexpected rains and strong wind in large parts of Punjab and Haryana in late March and in early April. The untimely rains have led to an increase in moisture content of wheat and could also impact quality. The government can only purchase wheat with a maximum moisture content of 12 per cent. Arrival has also been low in Haryana, where it dropped from 3.7 million tonnes to 3.24 million tonnes. In Madhya Pradesh, another leading procurement hub, the arrival dropped from 4.25 million tonnes to 3.17 million.