Wheat procurement falls 18% as lower arrival bites

Touches 22.9 million tonne as buying process almost ends

WHEAT procurement has taken a hit as it has declined 18% to 22.9 million tonne (mt) so far this year following lower arrival of grains in the market despite forecast of a higher output.

In the current 2016-17 marketing year, wheat procurement has touched 22.9 mt and the purchase process has almost ended.

The Food Corporation of India (FCI), the nodal agency for procurement and distribution of foodgrains, had procured 28 mt of wheat in the 2015-16 marketing year (April-March). The bulk of the procurement is done during April-June.

Procurement has fallen mainly due to lower arrival of wheat this year at about 25.6 mt as against over 31 mt last year, a senior official said.

However, the official said there would not be any shortage of wheat in the country as FCI has about 31 mt of wheat in the stock as against the buffer norm of 27.5 mt as on July 1.

In view of the lower procurement, the government has reduced the quantity of wheat to be sold under the Open Market Sale Scheme (OMSS) in 2016-17 against 10 mt last year.

According to the agriculture ministry’s third advance estimate, the country’s production has risen to 94.05 mt in the 2015-16 crop year (July-June), from 86.53 mt in the previous year.

The government has decided to further extend 25% import duty on wheat to curb inward shipments. Private traders have so far imported 5 lakh tonnes of wheat from Australia and France. PTI