Private firms nudging central procurement agencies out in buying more wheat from farmers for exports

The Centre’s wheat procurement has declined by 32 per cent to 69.24 lakh tonnes till April 17 of the current rabi marketing year as private companies are buying grains aggressively for exports.

As per the official data, about 69.24 lakh tonnes of wheat has been purchased by the government agencies till April 17 of the ongoing 2022-23 rabi marketing season (RMS) as against 102 lakh tonnes in the year-ago period. The rabi marketing season runs from April to March but the bulk of procurement ends by June.

State-owned Food Corporation of India (FCI) and state agencies undertake procurement at a minimum support price to meet the requirement under the Public Distribution System (PDS) and other welfare schemes.

The Centre has set a target to procure record 444 lakh tonnes of wheat in the 2022-23 marketing year as against an all-time high 433.44 lakh tonnes in the previous marketing year. In Haryana and Madhya Pradesh, private sector has been increasingly buying wheat directly from the farmers, aimed primarily at exports.

As per the data, the government’s wheat procurement in Haryana reached 28 lakh tonnes till April 17 of the current marketing year when compared to 44 lakh tonnes in the year-ago period. As much as 9 lakh tonnes were purchased in Madhya Pradesh as against 17 lakh tonnes in the comparable period.

In Punjab, the government agencies have procured 32 lakh tonnes of wheat as against 34 lakh tonnes in the year-ago period. According to the official sources, the procurement is slightly less in Punjab and this could be because of shriveled wheat grains due to early onset of heat wave.

There is a huge demand for Indian wheat amid sharp decline in availability of the grain in the global market due to the ongoing conflict between Russia and Ukraine. Both nations are major producers and exporters of wheat. Egypt has recently agreed to purchase wheat from India.

Earlier this month, Food Secretary Sudhanshu Pandey said traders have entered into contracts for export of 3-3.5 million tonnes of wheat during the April-July quarter of the current fiscal.

The country is estimated to have exported over 7 million tonnes in 2021-22 fiscal. Wheat production is pegged at a record 111.32 million tonnes in the 2021-22 crop year (July-June), as per the second advance estimate of the agriculture ministry.

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