Foodgrain stocks slide to 39.7 mt but still double than whats needed

Written by Sandip Das | New Delhi | Updated: Mar 15 2014, 09:58am hrs
Two weeks before the Food Corporation of India (FCI) and state-owned agencies' wheat procurement drive for the 2014-15 season, the government's grain stocks, mostly rice and wheat, dipped to 39.7 million tonne (mt) against 41 mt reported last month.

The volume of grain stocks, however, is almost double the requirement under the government's buffer stocks and strategic reserve norms.

According to latest data, government agencies have wheat stocks of 20.8 mt and rice stocks of 18.8 mt at the beginning of the month. The bulk of wheat stocks are held with the FCI and state agencies in Punjab ( 8.6 mt) and Haryana (4 mt).

For reducing excess stocks, FCI has sold close to 6 mt of wheat under the Open Market Sale Scheme (OMSS) in the current fiscal to bulk buyers and is aiming at exporting 2 mt of wheat this year.

As per the second advance estimate released last week, wheat production is likely to cross a record 95.6 mt in 2013-14 against 93.5 mt achieved in the previous year.

At present, rice stocks are held with key contributing states of Punjab, Haryana, Andhra Pradesh and Orissa. However, rice stocks of 18.8 mt do not include new procurement being carried out for 2013-14 marketing season (October-September).

Till now, more than 24 million tonnes of rice have been procured this year.

Due to open-ended procurement policy for rice and wheat adopted by the government, the agencies have been buying large chunk of grains from farmers in the key mandis, which had led to the average grain stocks hovering around 50 55 mt in the last couple of years.

A food ministry official said the wheat procurement drive for 2014-15 season would commence from April 1, when the rabi wheat crop is expected to arrive in the mandis of Punjab, Haryana, Madhya Pradesh, Uttar Pradesh and Rajasthan.

We are targeting at procuring 31 mt of wheat during 2014-15 marketing season, a food ministry official said. Due to a rise in private purchase from the farmers, FCI could procure only about 25 mt in the 2013-14 marketing season against a target of 33 mt.