Wheat procurement by the Indian Government through the Food Corporation of India (FCI) has jumped 32 per cent within the first three days of April. The rise does not include the quantity bought last month. Though the procurement normally begins on April 1, the Government began the purchase early this year and as a result bought 0.26 million tonnes (mt) as of March 31.
According to the official data, wheat procurement until April 3 since it began from March 1 was 0.59 mt, up by 67 per cent from 0.35 mt a year ago. This is encouraging for the government considering that arrivals until April 3 was 1.29 mt, down 13.5 per cent from 1.49 mt a year ago. The percentage of procurement against arrival this year is 46 per cent compared with 24 per cent a year ago.
Bonus payment
The bulk of the purchase has been reported from Madhya Pradesh at 0.58 mt, which is 98 per cent of the total purchases made so far. The minimum price in mandis of MP has marginally increased over the last 3-4 days to ₹2,234/quintal from ₹2,150-2,160, traders said. The State government is paying a bonus of ₹125/quintal over and above the wheat’s minimum support price of ₹2,275/quintal.
But, Rajasthan, which also announced the same amount of bonus, has reported a procurement of 9,703 tonnes out of 0.14 mt arrival. Uttar Pradesh, which last month unofficially asked big companies and stockists not to enter the wheat market until the State buys the targeted quantity, has purchased 2,706 tonnes out of 38,209 tonnes that arrived at the purchase centres.
However, Agmarknet portal shows that the wheat arrival in all the mandis of Uttar Pradesh was 0.33 mt, in Rajasthan it was 0.18 mt and in Madhya Pradesh it was 1.42 mt.
Interestingly, the percentage of procurement against arrival (at purchase centres) this year was 73 per cent during April 1-3 against 37 per cent in the year-ago period. The government had procured over 85 per cent of the wheat arrived in purchase centres in entire 2023-24 procurement season.
Record output projection
“If the current trend continues, there could be 30 per cent jump in wheat procurement from last year, which may help the government to restore the original allocation, cut and substituted with rice two years back, under the food security law,” said an industry expert.
In 2023-24 season, the Centre had procured 26.2 mt of wheat out of the targetted 34.15 mt and in 2022-23 only 18.8 mt was bought for the Central Pool against the target of 44.4 mt.
While the Agriculture Ministry has pegged the wheat production to be at a record high of 112.02 mt for 2023-24 crop year (July-June), the Food Ministry has pegged the likely procurement to be 37.29 mt in the marketing year beginning April 1. The Centre estimates to buy 13 mt of wheat from Punjab, 8 mt, each from Haryana and Madhya Pradesh, 6 mt from Uttar Pradesh and 2 mt in Rajasthan.