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Wheat purchases by state-run procurement agencies at several mandis in Punjab, the biggest contributor to the country’s pool grain stock, will be impacted for the next few days. This is because a team of officials from the food ministry is visiting the mandis for assessing the issue of shrivelled or immature grain being brought for procurement by the farmers.

Sources told FE that in several mandis in Punjab, farmers are bringing in shrivelled grains in excess of the Food Corporation of India’s prescribed maximum permissible limit of 6%, which they say is because of the heat wave conditions that prevailed earlier this month. The Punjab government has asked for relaxation in norms for shrivelled grains so that farmers’ produce could be procured by FCI and state government agencies.

Officials said that unusually high temperature prevailing for the last two weeks has caused grain to shrivel in Punjab, where agencies have set a procurement target of 13.2 million tonne (mt) in the ongoing rabi marketing session (April-June) for 2022-23.

Meanwhile, more than 2.28 mt of wheat has been procured from the farmers mostly in key growing states of Punjab, Haryana and Madhya Pradesh by agencies till Tuesday which is more than 36% less compared to the same period previous year. Officials said that the pace of procurement is expected to get a boost after the Baisakhi festival to be celebrated on Thursday.

Five agencies, including FCI, Markfed and Pungrain have been entrusted with the responsibility of procurement of wheat at MSP from the farmers in Punjab where more than 0.78 mt of wheat has been purchased so far. In Haryana, 0.77 mt of wheat has been procured by agencies while in Madhya Pradesh, more than 0.71 mt of grain has been purchased from the farmers.

In other key wheat growing states such as Uttar Pradesh, Rajasthan, Uttarakhand and Gujarat, procurement is yet to pick up pace.

This time wheat procurement is being keenly watched as a surge in exports mostly from Madhya Pradesh has pushed up mandi prices of the grain above minimum support price (MSP) of Rs 2,015 per quintal. According to Gagan Gupta, a Sehore, Madhya Pradesh based wheat trader, the procurement target of 12.9 mt for the state would decline by more than 6–7 mt this session. “Farmers prefer to sell their produce to traders because of instant cash payment while in case of procurement by government agencies it takes a few days to get the payment,” Gupta said.

Food ministry officials have stated that the target of 44 mt of grain procurement from the farmers across all the growing states would be reduced by around 10 mt due to a possible surge in export and high mandi prices. India is aiming at exporting 10 mt of wheat in 2022-23.

The official procurement session is from April-June, while a bulk of the wheat crop arrives in the mandis during the first six weeks of the procurement session.

Food ministry officials have indicated that a drop in wheat procurement volume is unlikely to impact the grain allocation to the public distribution system under National Food Security Act as FCI has more than 23 mt of wheat as on April 1, against buffer norm of 7 mt. The government distributes 5 kg of rice or wheat to close to 81 crore beneficiaries under NFSA at Rs 3 and Rs 2 per kg, respectively.



Author: Howard Caldwell