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Wheat procurement drive by the Food Corporation of India and state agencies for 2022-23 (rabi marketing season) have commenced on a slower pace mainly in Punjab, Haryana and Madhya Pradesh, where only 0.11 million tonne (mt) of grain has been purchased till Wednesday from the farmers.

Officials told FE that the procurement drive is expected to peak after the middle of April or post Baisakhi festival to be celebrated on April 14.

The procurement in other key growing states of Rajasthan, Uttar Pradesh and Uttarakhand are expected to peak up pace in the coming weeks.

This time wheat procurement is being keenly watched as 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. The procurement target of 12.9 mt for the state would decline by more than 6–7 mt.

Around 70,000 tonne of wheat has been procured in the state so far. The state is the second-biggest producer of wheat in the country and also contributes the highest volume of grain to the central pool.

An official from Punjab said wheat purchase in the state could decline by around 1 mt, from the target of 13.2 mt for the session. Five agencies, including Food Corporation of India (FCI), Markfed and Pungrain have been entrusted with the responsibility of procurement of wheat at MSP from the farmers.

Meanwhile, Uttar Pradesh, the biggest producer of wheat, has set up 6,000 centres to commence procurement of around 6 mt in the 2022-23 marketing session. However, in the previous year, the state could lift 5.64 mt of grain from an estimated 13 lakh farmers.

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 (NFSA). The government distributes 5 kg of rice or wheat to close to 81 beneficiaries under NFSA at Rs 3 and Rs 2 per kg, respectively.

Recently, the Union Cabinet decided to extend the free ration scheme — the Pradhan Mantri Garib Kalyan Anna Yojana announced in 2020 to deal with the Covid-19 pandemic by six months to September-end 2022.

As of date, the FCI has grain stocks of 50.8 mt against the April 1, buffer stocks of 21.04 mt. Besides, 23.7 mt of rice is yet to be received from the millers.



Author: Howard Caldwell