Foodgrain prices cut for APL families to relieve FCI stocks

As Food Corporation of India (FCI) faces acute storage crunch, the government has significantly reduced the price of wheat and rice given to states under a ‘special allocation scheme’ targeted at above poverty line (APL) families.

The scheme which folded up on May 24, has been relaunched with the new price to encourage states to lift more from their allocated quantities.

Under this special allocation to states, each APL family was allocated 10 kg of food grains per month over and above the allocations made under the Targeted Public Distribution System (TPDS). The scheme was launched in January 2010. The special scheme was in addition to the Targetted Public Distribution System (TPDS).

Sources told FE that states lifted just around a million tonne of rice and wheat out of the total allocation of around 4 million tonne under this special scheme. The price for wheat was fixed at Rs 1,080 per quintal while rice was sold at ‘minium support price (MSP) derived rate’.

The food ministry in its order on 25 th May has reduced the price of wheat for this special allocation to Rs 845 per quintal and for rice the price has been brought down to Rs 1,185 per quintal to encourage states to lift more.

Besides the food ministry has asked the states to include even BPL families under the scheme.

?We have made a fresh allocation of 1.37 million tonne of rice and 1.68 million tonne of wheat under the scheme,? the food ministry official said.

States can lift the foodgrain under the scheme till November 20.

Nagaland on Tuesday lifted 1,900 tonne of wheat and 60 tonne of rice under the special scheme for APL families.

The Food Corporation’s efforts to sell excess wheat stocks through the Open Market Sale Scheme (OMSS) to bulk

consumer also got moderate success as only 1.2 million tonne of wheat was lifted by private millers against a allocation of 2.1 million tonne.

As on May 1, FCI has foodgrain stocks of 60 million tonne which is far above strategic reserve and buffer stocks norms.

FCI allocates wheat and rice to the states under TPDS to the tune of 24 ? 26 million tonne per annum. Besides the corporation has to keep around16 million tonne of wheat and rice for strategic reserve and buffer stocks norms. A smaller quantities of food grains is also allocated to armed forces.