Govt procurement gathers pace after a sluggish start
Punjab’s government agencies achieve a record single-day wheat procurement of 1.13 million tonnes after delayed harvesting due to cooler weather. Nationwide, wheat purchases total 13.58 MT, with FCI aiming for 30 MT. Other contributing states include Haryana, Madhya Pradesh, Uttar Pradesh, and Rajasthan. To mitigate crop damage in Rajasthan and Madhya Pradesh, purchase norms relaxed. With increased MSP and bonuses announced, wheat output may surpass estimates, bolstering national stocks.
After a delayed harvesting due to cooler climate, the government agencies in Punjab, the biggest contributors to central pool stock, procured a record 1.13 million tonne (MT) of wheat under minimum support price (MSP) on Wednesday.
“This is an all time record for a single day procurement by agencies for wheat and rice across the country,” Vikas Garg, principal secretary, food and civil supplies, Punjab, told FE.
He said after a delay, arrivals across mandis in the state have seen a surge in the last one week and 6.8 MT of wheat has been purchased by agencies in the state so far in the rabi marketing season 2024-25 (April-June).
In the next one week, total purchase by agencies in Punjab is likely to touch a record 13 MT for the season which would bolster the prospects of the Centre’s aim of achieving 30 MT of wheat procurement in the 2024-25 season.
Meanwhile, the government wheat procurement drive by the Food Corporation of India (FCI) and state agencies for the current marketing season has crossed 13.58 MT till Wednesday since purchase under the MSP officially commenced on April 1.
The wheat purchase so far is 20% lower than the same period previous year.
“We are witnessing an upsurge in arrivals of wheat in mandis in the last one week as harvesting of crops was delayed by a fortnight because of cooler climate in March,” a food ministry official said.
Other contributors to the central pool procurement include Haryana (5.19 MT), Madhya Pradesh (3.1 MT), Uttar Pradesh (0.43 MT) and Rajasthan (0.26 MT) so far.
To boost purchases in Rajasthan and Madhya Pradesh where crops had been hit due to recent rains, the food ministry has relaxed the norm for grain purchase and the agencies will buy wheat if it’s “shrivelled and broken” up to 15% without value cut against normal criteria of up to 6%.
The limit of lustre loss of wheat is relaxed up to 70% without any value cut for Madhya Pradesh.
The government is aiming to purchase 30 MT of wheat this season against 26 MT procured last year, mainly from Punjab, Haryana, Madhya Pradesh, Rajasthan and Uttar Pradesh, to bolster stock, which had plummeted to a 16 year low at the beginning of the month at 7.57 MT.
FCI requires around 18 MT of wheat annually for distribution of grain under the free ration scheme — Pradhan Mantri Garib Kalyana Anna Yojana.
“We need sufficient stock to carry out open market sale of grain to the bulk buyers next year,” an official said.
The government has announced an MSP of `2,275/quintal for the 2024-25 season which is an increase of `150/quintal over the previous season.
In addition, Rajasthan and Madhya Pradesh have announced a bonus of `125/quintal as bonus over MSP.
According to Gyanendra Singh, director, Indian Institute of Wheat and Barley Research, based in Karnal, Haryana, wheat output this year 2023-24 crop year (July-June) may cross the current estimate of 112 MT because of factors such as record sown area at 34 million hectare, longer winter season and no reports of disease outbreak.
Source Link: https://www.financialexpress.com/business/industry-govt-procurement-gathers-pace-after-a-sluggish-start-3468819/
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