Kharif paddy procurement by the Food Corporation of India (FCI) and state government agencies has got off to brisk start. Till Saturday, 1.72 million tonnes (mt) of the cereal were purchased from farmers, 58% higher than a year ago.
Paddy arrivals in mandis in Punjab and Haryana, major contributors to the central pool stocks, are picking up.
Punjab, the biggest contributors to central pool, agencies have purchased 0.43 mt of paddy till Saturday which is 17% less than the same period previous year. Officials said that procurement would pick up pace in next two weeks as in some areas the harvesting has been delayed because of recent rains.
However, in Haryana, agencies have procured 0.87 mt of grains under the Minimum Support Price (MSP) operation which was 80% more than a year ago period.
“We were anticipating arrivals to pick by middle of this month, but most of the mandis are witnessing heavy arrivals of grain currently,” an official with agricultural produce marketing committee (APMC) market yard, Karnal, Haryana’s biggest grain mandi, told FE.
Meanwhile, more than 0.4 mt of paddy is purchased from farmers in Tamil Nadu by the government agencies while the procurement operations have commenced in Uttar Pradesh and Uttarakhand.
This year’s rice procurement drive would be closely monitored given the anticipated decline in production in 2022-23 season because deficient monsoon rainfall in eastern regions is seen to adversely impact the purchases for the central pool stocks. The government is aiming to boost rice procurement because of a decline in stocks because of the free ration scheme being extended for a seventh time till end of this year.
Paddy to rice conversion ratio is 67%. After paddy is procured from the farmers by FCI and state agencies, it is handed over to millers for conversion into rice.
Despite an estimated 6 mt of decline in rice production in 2022-23 crop year (July-June) from a record 130 mt in 2021-22 crop year, the government had set a marginally higher target of 51.8 mt of kharif rice procurement for 2022-23 season.
Kharif rice procurement was 50.9 mt in 2021-22 season. Kharif procurement contributes around 86% of the total rice purchased from the farmers by FCI and state agencies under the MSP operation.
Paddy arrivals in mandis in Punjab, Haryana, Uttar Pradesh and Tamil Nadu are during October-November period while arrivals of grain take place during December –January, in Andhra Pradesh, Telangana, Odisha, Chhattisgarh and other key producing states.
In the 2021-22 procurement season, FCI have procured more than 59.2 mt of rice.
In the previous year, rice procurement was a record 60.2 mt. Rice production had hit a record 130.29 mt in the 2021-22 crop year.
At the beginning of this month, the rice stock held with FCI was around 22 mt. This stock excludes 9.5 mt of rice yet to be received from millers. Current rice stocks far exceed buffer stock norms of 10.2 mt.
States including Punjab, Haryana, Chhattisgarh, Odisha, Telangana and Andhra Pradesh contribute significantly to the central rice pool which is used for supplying grain to beneficiaries under the National Food Security Act and free ratio scheme. The rice procured from grain surplus states is also used for keeping a buffer stock with FCI.
The government had earlier increased the MSP of the common variety of paddy by more than 5% to Rs 2,040 a quintal for 2022-23 season from Rs 1,940 per quintal in the previous season.