The latest data indicate that at the start of the month, FCI and the state agencies have stock mostly comprising rice and wheat in excess of 38 million tonne (mt). However, the actual stock would be more than 48 mt if unmilled paddy held with the private millers is taken into account.
The agencies have wheat stocks of 17.8 mt and rice stocks of more than 20 mt, while the FCI is yet to take delivery of more than 10.2 mt of rice from the millers.
The huge stock is against the strategic reserve norms of 21.2 mt.
Most of the stock is held in Punjab (7 mt), Madhya Pradesh (2.1 mt), Haryana (2.9 mt) and Rajasthan (1.2 mt). The rice stocks are mostly with agencies' godowns in Punjab (8.6 mt), Andhra Pradesh (2.9 mt) and Haryana (1.3 mt)
Food ministry officials said grain stocks are expected to rise sharply in the next few months as wheat procurement for the 2014-15 has recently commenced albeit on a slower pace in key growing regions of northern India.
The officials said the corporation could sell about 5.8 mt of wheat to bulk buyers last fiscal and expected to export around 1.5 mt in the year in a bid to deal with excess stocks.
Till Monday, government agencies purchased about 8 lakh tonne of wheat from farmers mostly in Madhya Pradesh while procurement in Punjab and Haryana have been delayed and will be picking pace in the next two months.
The government has set a target of 31 mt of wheat procurement for the April-July period. Due to a rise in private purchase from the farmers, FCI could procure only about 25 mt during the 2013-14 season against a target of 33 mt.
Due to the 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 that has led to the average stock hovering around 50 55 mt in the last couple of years.
The government-owned agencies buy grain from farmers for distribution under the targeted public distribution system (TPDS) and for maintaining buffer stock and strategic reserve norms. Around 3 to 4 million tonne of rice and wheat are distributed monthly to states under TPDS. The corporation also keeps grain for distribution to the armed forces.
State-owned agencies have a total storage capacity of about 61 million tonne. This includes 18 mt of cover and plinth (CAP) capacity, where grains can't be stored for a long period.