A month into the harvesting season, the arrivals of wheat in the market stood 32% lower than the same period last year, denting the government’s optimism that output of this key grain would touch a record 95.6 million tonnes (mt) this year, reports Sandip Das in New Delhi. The arrivals, market observers say, have been hit by unseasonal rains that delayed the harvesting in Punjab, Madhya Pradesh and Haryana. Analysts see no immediate impact of the delayed arrivals of wheat on the targeted public distribution system given the comfortable “carry-forward stocks”of close to 18 mt with the procurement agencies — the buffer norm is 7 mt. They, however, fear that if the supply from farmers to the market doesn’t pick up in the next couple of weeks, it could adversely impact the release of the grain under the food security law.
Under the law, 67% of the country's population are to be given wheat and rice at Rs 2 and Rs 3 per kg, respectively. Wheat arrivals usually begin by the last week of March and gathers pace by the end of April. According to the Food Corporation of India, the arrivals in mandis stood at 12.9 mt on Friday as against 17.1 mt during same period last year.
The arrivals have seen the sharpest fall in Punjab (130%) and Madhya Pradesh (28%). Punjab and Madhra Pradesh are the major contributors to the government's wheat procurement drive – while the procurement target for this season has been set at 31 mt, Punjab is expected to provide 11 mt and Madhya Pradesh, 8 mt.
“We would be lucky if we match last year's wheat procurement figure of 26 mt,” a food ministry official told FE, acknowledging that the government may have overestimated the procurement level. In 2013-14, the government had to scale down the procurement target from 34 mt to 26 mt during the middle of the marketing season (April-June) and eventually ended up purchasing 25 mt of grain from farmers.