Grain stocks down 19% y-o-y

New Delhi, Aug 29 | Updated: Aug 30 2006, 05:30am hrs
Indias total food grain stocks as on August 1 were down 18.9% on year at 17.46 million tonne, a government official said on Tuesday. He added the deficit was largely on account of low wheat procurement.

The government managed to purchase only 9.2 million tonne wheat from farmers this year compared with 14.8 million tonne last year. The low procurement has pushed the governments wheat stocks down to 7.33 million tonne as on August 1 from 12.98 million tonne a year ago.

To offset the decline in wheat stocks, the government increased the allocation of coarse grains to state-run welfare schemes. As a result, its grain stocks also fell 56.6% on year to 2.55 lakh tonne, the official added. He said the governments rice stocks, however, have rose substantially to 9.88 million tonne, up 23.6% from last year on higher procurement. It has

so far bought 27.6 million tonne rice from farmers in the current season that ends on September 30. CRISIL MarketWire

The official added the government has enough wheat stocks to last till March, as it has cut down allocation for public distribution system (PDS) and other welfare schemes to less than 1 million tonne a month.

Moreover, wheat imports intended for the Food Corporation of India (FCI) have started arriving, so we will not face a shortage, the official said.

The government has already contracted import of about 3.9 million tonne wheat and is likely to import additional 1.6 million by February end to ensure adequate carryover stocks for the next wheat marketing year that commences April 1. The government should have at least 4 million tonne wheat as buffer as on April 1.