Foodgrain stocks hit all-time high of 73.85 mt in April

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April 27, 2020 6:01 AM

The Pradhan Mantri Garib Kalyan Yojana (PMGKY) relief package, announced on March 27 to alleviate the distress of people most affected by the nationwide lockdown, may help whittle down some of the excess foodgrain stocks.

Wheat stocks, at 24.7 mt, were 3.3 times the necessary level of 7.46 mt for April 1, when procurement of the new crop that arrives in the markets begins. Wheat stocks, at 24.7 mt, were 3.3 times the necessary level of 7.46 mt for April 1, when procurement of the new crop that arrives in the markets begins.

Foodgrain stocks in the central pool stood at 73.85 million tonne (mt) as on April 1, the highest ever for this date and three-and-a-half times the minimum operational-cum-strategic reserve requirement of 21.04 mt.

The 73.85 mt figure includes 24.70 mt of wheat and 32.24 mt of rice. In addition, the Food Corporation of India (FCI) and state government agencies were holding 25.24 mt of un-milled paddy, whose rice equivalent, at an outturn ratio of 67%, worked out to 16.91 mt.

Wheat stocks, at 24.7 mt, were 3.3 times the necessary level of 7.46 mt for April 1, when procurement of the new crop that arrives in the markets begins. The previous record for this date was 24.21 mt in 2013 (see table). Rice stocks (inclusive of the milled paddy equivalent) were also at an all-time-high of 49.15 mt and 3.6 times the normative minimum of 13.58 mt for April 1.

The build-up of stocks to such high levels is mainly a result of governmental procurement of grain exceeding offtake from the central pool. In 2019-20 (April-March) alone, total procurement amounted to 80.64 mt, comprising 46.51 mt rice and 34.13 mt wheat. Against this, the aggregate offtake was just over 62 mt. That included 52.85 mt under the National Food Security Act (NFSA), 3.77 mt under midday meals and other welfare schemes, and 5.25 mt of open market sales through e-auctions.

The Pradhan Mantri Garib Kalyan Yojana (PMGKY) relief package, announced on March 27 to alleviate the distress of people most affected by the nationwide lockdown, may help whittle down some of the excess foodgrain stocks. The NFSA currently entitles three-fourths of all rural and half of all urban households to 5 kg of wheat or rice per person per month at Rs 2 per kg and Rs 3 per kg, respectively. Under the new package, an extra 5 kg of wheat/rice is being given per person per month, free of cost, for a three-month period from April to June 2020. An additional 12.14 mt of wheat and rice has been allocated for this purpose.

Meanwhile, the total storage capacity available with FCI and state agencies has been assessed at 75.85 mt as on December 31, 2019. That includes 62.64 mt of covered godown space, with the remaining 13.20 mt being open storage in cover-and-plinth structures. With procurement of the new wheat crop taking off, the challenges of stocking will only go up in coming weeks. The only “relief” may come from PMGKY.

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