Hoarding, transport snags choke supply of essentials

Businesses blame lean inventories on panic-buying and issues with the transportation of food supplies

NEWDELHI:A supply crunch of consumer items has cascaded across states, as buyers, rich and poor, scour markets for everyday needs amid a lockdown to stop the spread of Covid-19.

Businesses blame their lean inventories on panic-buying of goods equivalent to two-three months of household supplies by affluent classes, as they hunkered down for the shutdown.

They also blame issues with the transportation of food supplies, including grains, edible oil, fruits, vegetables, milk, even consumer products. Some stores are selling limited quantities of items to discourage hoarding. “The excess buying has strained backend stocks and godowns,” said market tracker Comtrade in a note. Inventories that should have lasted two months were exhausted in a week, it said.

And deliveries at the last-mile are hobbling under tight local rules of individual states.

Federal instructions and orders issued by state administrations are not in tandem, firsthand reports suggest. India is one economy but many individual markets. Steering all of them in one direction, all of sudden, has been a key challenge, ground reports indicate.

Part of the problem is also that modern supply chains are intricate. A bread maker typically depends on three: agriculture, biological and chemical leavening agent producers and the packaging sector, each with its own supply chain.

A soaring milk demand ahead of the lockdown followed by a sharp fall now has upset supply schedules, RS Sodhi, the managing director of Amul, India’s largest dairy cooperative, said . Small milk suppliers and aggregators were under pressure but the overall availability is adequate, he added.

Some states have seen milk demand drop, leading to farm losses. “Owing to regulatory measures in the wake of Covid-19, there is a decline in milk and milk products, and difficulties have arisen in interstate movement for its conversion to milk powder,” Rajesh Kumar Singh, additional chief secretary of Kerala said.

Hundreds of trucks are stuck on state borders, despite home ministry’s orders allowing movement of both essentials and nonessentials. “The home ministry’s orders have not percolated to the ground level... Trucks are still being stopped at state borders ...,” Kultaran Singh Atwal, president of the lobby group All-India Motor Transport Congress said.

The Food Corporation of India is ramping up supplies.

“During the lockdown, the FCI is replenishing 10 lakh (1 million) tonne of foodgrains through 352 rakes of Indian railways,” Union food minister Ram Vilas Paswan said in a tweet.

But there is a problem. It only stocks cereals (rice and wheat), and limited quantities of pulses and sugar. The crisis is concentrated in a clutch of other items: flour, biscuits, edible oil, soaps, handwash, some lentils, vegetables, baby food, packaged juices, medicines for a variety of conditions, even matchboxes.

“Earlier, wholesalers would deliver to my shop. Now, I have to make beeline to the wholesaler,” general provisions store proprietor Ravindra Ghosh said from Ranchi’s Kokar locality.

To resolve logistics issues, the Union government has formed a committee under the ministry of home affairs. It comprises secretaries to various ministries, apart from railway board chairman. It is tasked with ensuring supply of essential and medical goods.

On the ground, however, broken chains of command are testing the limits of ensuring a billion people’s needs are met. The country went into a lockdown with less than four hours of notice.

Police crackdown on agricultural activities have upended harvesting and transportation of crops. Md Moinuddin, a vegetable wholesaler in Assam’s Kamrup district, said he has not been able to hire trucks to get stocks into Assam city after police seized trucks plying without permits.

Cultivators are piling perishables in cold chains, as buyers aren’t purchasing in large quantities, unsure of transport.

Truckers have sought extension of the due date for payment of road tax and GST to September 30. “On the 8th day of the countrywide lockdown, the government is making efforts to restore supply chains. There is no clear policy on whether to run vehicles or not, especially those with non-essential goods,” Singh said.

Three major wholesale hubs run by state-regulated agriculture produce market committees — Lasalgaon in Maharashtra, Mullana near Haryana’s Ambala and Gollapally in Telangana’s Karimnagar — said they were operating with 30-40% less staff.

In this vacuum, Indian Railways has stepped up.

A railway ministry official said issues at many terminal points, loading and unloading operations were being resolved now. There are issues of shortage of labour, he said. As many as 1,43,458 wagons of essential goods were loaded over the past three days. Special focus is being given to essential commodities like foodgrains, sugar, fruits & vegetables, petroleum products and fertilisers.

Scheduled passenger flights have been pressed into service to supply cargo nationwide. Over the past few days, 85 flights have carried 76 tonnes. All passenger flights are grounded till April 14.

“We are operating flights despite logistical challenges in transportation of cargo to and from airports and in movement of aviation personnel,” a ministry of civil aviation official said.