Govt buys 196 lakh tonne wheat so far, higher than annual demand of 186 lakh ton for welfare schemes

New Delhi: The government has bought over 196 lakh tonne of wheat so far in the ongoing 2024-25 marketing year, surpassing its annual requirement of 186 lakh tonne for all welfare schemes including the National Food Security Act.

Now, the Food Corporation of India (FCI) -- the government's nodal agency for procurement and distribution of foodgrains -- is making efforts to meet its target of buying 310-320 lakh tonne in the 2024-25 marketing year to augment buffer stocks and keep surplus grains for making intervention in the open market, if needed, to control retail prices. Procurement of wheat, a major rabi (winter-sown) crop, is down 11 per cent so far from 219.5 lakh tonne in the same period last year. This is mainly due to lower purchases in Madhya Pradesh and Punjab. "Government's procurement is going on smoothly, Till now, we have procured 196 lakh tonne whereas the annual requirement of Prime Minister Garib Kalyan Anna Yojana (PMGKAY) and other welfare schemes is 186 lakh tonne," FCI CMD Ashok K Meena said when asked about procurement operations. "We are also on track to achieve our procurement estimated as arrivals of wheat in Punjab and Haryana are very good," he said, adding that the FCI would procure around 200 lakh tonne from these two states alone.

The Centre had procured 261.97 lakh tonne of wheat in the 2023-24 marketing year (April-March). The bulk of procurement is done during April-May.

As per the Union Agriculture Ministry estimates, production of wheat is seen at 1,120.19 lakh (112 million) tonne in the 2023-24 crop year (July-June) as compared to 1,105.54 lakh (110.5 million) tonne in the preceding year. There are chances of output reaching around 1,150 lakh (115 million) tonne on higher yields than expected in some states.

According to sources, the FCI has procured wheat worth Rs 45,000 crore from nearly 16 lakh farmers from various states at MSP, which is Rs 2,275 per quintal.

The arrivals of wheat crops currently in Punjab and Haryana are good. FCI expects to procure 130 lakh tonne from Punjab and 70 lakh tonne from Haryana.

Sources said, the FCI might extend procurement operations in a few states like Uttar Pradesh and Madhya Pradesh, before May as it expects late arrivals of crops in the mandies. The idea is to have surplus stocks to launch Open Market Sale Scheme (OMSS) if needed to control prices. Last year, over 100 lakh tonne were offloaded to flour millers and other wheat-based industries under this scheme.

The FCI has also relaxed quality norms in many states including MP to ensure farmers get minimum support price (MSP) for their crops.

"Procurement in Madhya Pradesh is a cause of concern. But we expect the momentum to pick up," a government official said.

This could be because of a combination of various factors including a shift in area to pulses, buying by traders at farm gate and farmers holding the grains for better realisation.

Procurement in wheat so far in MP has reached 34.66 lakh tonne as against 55.59 lakh tonne in the corresponding period of the previous year.

Regarding the buffer stock, the Centre had 75.02 lakh tonne of wheat in the central pool as on April 1, 2024, as against the buffer norm of 74.6 lakh tonne on that date. The buffer norm for July 1 is 275.8 lakh tonne.

In case of rice, the official said the situation is very comfortable as the FCI expects to procure 540 lakh tonnes in the 2023-24 marketing year (October-September) as against the annual requirement of 400 lakh tonne for all the welfare schemes.

"In rice, we have stocks of extra one year," the official added. The buffer stock of rice currently is 532 lakh tonne.

To provide relief to the common man, the Centre has so far sold 5.6 lakh tonne of 'Bharat rice', which is being sold at a subsidised rate of Rs 29 per kg. Around 9.6 lakh tonnes of wheat have been lifted so far to convert into 'Bharat Atta' being sold at Rs 27.50 per kg.