The paddy procurement drive by the Food Corporation of India (FCI) and state government agencies for the kharif season – 2023-24 (October-September) has commenced in key producing states of Punjab, Haryana and Tamil Nadu, with total purchase of around 0.73 million tonne (MT) of paddy so far which a tad higher than previous year.
This year’s rice procurement drive would be closely monitored as the uneven distribution of monsoon rainfall (June-September) this season may impact the yield of rice production in 2023-24 crop year (July-June) despite higher area under paddy cultivation.
Last month the Food Corporation of India (FCI) and state government agencies had set a 52.1 million tonne (MT) of rice (77.4 MT of paddy) purchase target in this kharif season against 49.5 MT of grain purchased last season.
In terms of state-wise procurement target for rice, the agencies are aiming to purchase grain including Punjab (12.2 MT), Chhattisgarh (6.1 MT), Telangana (5 MT), Odisha (4.4 MT), Uttar Pradesh (4.4 MT) and Haryana (4 MT).
Food ministry officials told FE that against an arrival of 0.99 MT of paddy in Haryana and Tamil Nadu and Punjab, the agencies have purchased 0.73 MT of paddy from the farmers under the Minimum Support Price (MSP) so far.
Although in its early days, paddy arrivals in mandis especially in Punjab and Haryana, major contributors to the central pool stocks are expected to peak at around the middle of this month
“We expect paddy arrivals to peak around October 15, as farmers are in the process of completing harvesting of paddy,” an official with Punjab’s food and civil supplies department at Khanna mandi, country’s biggest grain market, said.
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 2022-23 season, FCI and state agencies have procured more than 56.94 MT of rice both in kharif and rabi season. The rice production in 2022-23 was estimated at a record 135.5 MT.
Rice has been transplanted in 41.1 million hectare (MH), more than last five year average of 39.9 MH and up 3% on year.
As on Sunday, the corporation has 31.42 MT of rice which includes 9.2 MT of grain receivable from the millers. The rice stock is against the buffer of 10.25 MT for October 1.
It annually supplies 35 MT of rice for supply to the beneficiaries under the National Food Security Act (NFSA).
States including Punjab, Haryana, Chhattisgarh, Odisha, Telangana and Andhra Pradesh contribute significantly to the central rice pool which is used for supplying grain to NFSA beneficiaries. The rice procured from grain surplus states is also used for keeping a buffer stock with FCI.
The government has increased the MSP of the common variety of paddy by more than 7% to Rs 2,183/quintal for 2022-23 season compared to the previous season.
After paddy is procured from the farmers by FCI and state agencies, it is handed over to millers for conversion into rice. Paddy to rice conversion ratio is 67%.
Retail inflation in rice in August was 12.54% on year, marginally higher from the previous month. The government last month had banned exports of white rice to improve domestic supplies.
FCI is currently selling 2.5 MT of rice in the open market to cool down the prices from its stock.