Food ministry sources said the total wheat purchase by Food Corporation of India (FCI) and state-owned agencies would drop to around 33 million tonne (mt) from the initial target of record 44 mt. Last year, FCI lifted close to 39 mt of wheat from farmers.
However, a decline in procurement is not expected hamper availability of grain for the Public Distribution System (PDS) and buffer stocks and strategic reserve norm as the government has huge carry forward stocks of wheat, estimated at 22 mt, from the previous years. Lower procurement would also help the government in dealing with storage crunch.
Till Tuesday, the government purchased close to 23 mt of wheat as farmers bringing their produce to close to 3000 mandis across the country has been showing declining steadily.
Against a target of a record 14 million tonne of wheat, Punjab is expected to contribute around 11 mt this year.
We are yet to assess lower wheat arrival across the mandis as weather condition prevailing this year was conducive to the crop, DS Grewal, secretary, food civil supplies and consumer affair, Punjab told FE.
Last year, Punjab was the biggest contributor to the central pool with a record 13 mt of grain. Similarly, Haryana is expected to contribute only about 7 mt of wheat to the central procurement drive against 8.6 mt of achieved last year.
A FCI official said at present around 1.5 lakh tonne of wheat are being bought by farmers to mandis in Punjab and Haryana daily, against close to 3 lakh tonne last year. We expect to wind up procurement by middle of this month, the FCI official said.
Another key factor attributed to decline procurement in Madhya Pradesh and Uttar Pradesh had been private players buying wheat directly from farmers.
Private players such as roller millers have been buying wheat directly from farmers as they realised that government had refused to sale excess wheat to them under Open Market Sale Scheme (OMSS) at subsidised rates.
To stock up grain, private players became active buyers in Madhya Pradesh and Uttar Pradesh.