FCI may map areas with good quality wheat

Written by Sandip Das | New Delhi | Updated: Jan 25 2013, 08:43am hrs
Motivated by high price realisation in global markets, organisation plans to tap such regions to boost exports

Sensing good demand for Indian wheat in global markets, the Food Corporation of India (FCI) is considering a proposal to map those areas where quality of Indian wheat is superior.

This move follows an average price realisation of $315 a tonne for Indias wheat shipments during the current year. This was greater than the Chicago Board of Trade (CBT)s average price realisation of $287 per tonne.

We are thinking of identifying areas where quality wheat could be exported from, Amar Singh, chairman and managing director, FCI told FE. Singh said the wheat grown in the re-identified areas could be directly shipped for exports.

The mapping of quality wheat producing areas would help FCI and state government-owned procuring agencies in increasing exports, thanks to the rising demand for the foodgrain the globally. Through focusing on specific areas, our wheat could command premium in the global market, an FCI official noted. Premium quality wheat varieties are grown in many regions of Madhya Pradesh, Rajasthan and Punjab.

Till June 2013, the government has approved export of 4.5 million tonne of wheat from huge stocks of FCI. Out of this, 2 million tonne have already left Indian shores. The foodgrain is shipped mainly to countries such as Bangladesh, South Korea, Indonesia, Thailand and Malaysia.

Meanwhile, Commission for Agriculture Costs and Prices (CACP) chairman Ashok Gulati has said that India is expected to double wheat exports to 7-8 million tonne in 2013 as against an estimated 4 million tonne last year.

Huge domestic stocks and better global prices have allowed private players to export wheat as well. Thanks to huge stocks with the government, we could export more wheat during the next few months, Gulati noted.

With around two months to go for the commencement of wheat procurement drive for 2013-2014 season, the government has wheat stocks that are more than three times the strategic reserve and buffer stock norms. At the start of this month, the government had wheat stocks of more than 34 million tonne, while the requirement is only about 10 million tonne.

In September last year, the government had lifted the ban on rice and wheat exports after it was convinced that the central pool has sufficient stocks to meet the demand of TPDS and the proposed food security legislation.

World trade in wheat is greater than that for all other crops combined together. During 2011-12, India exported 7,40,747 MT of wheat to worth of R1,024 crore.