Wheat procurement under MSP likely to be lowest in last 10 years

The uptick in export of wheat following the global shortage due to the Ukraine-Russia war has led to a situation where wheat procurement is likely to be lowest in last 12 years from across India, especially from Punjab and Haryana, the two largest contributors to the central pool.

India was till last week headed to a record production but the heat wave that started in March and continued in April over northwest India is set to affect produce, especially in Punjab and Haryana.

As per Ministry of Food and Consumer Affairs data, as on Sunday, 136.93 lakh metric tonnes (LMT) of wheat were procured under the central pool in Rabi Marketing Season (RMS) 2022-23 in Madhya Pradesh, Haryana, Punjab, Uttar Pradesh, Uttarakhand, Chandigarh, Himachal Pradesh, J&K, Gujarat, Bihar, and Rajasthan.

In this, procurement in Punjab was 74.18 LMT, Haryana (36.09 LMT) and Madhya Pradesh was 25.76 LMT. "The procurement is still going on. We can expect the numbers to increase further," said an official.

The Food Corporation of India (FCI) data showed that as on April 20, the quantity of wheat procured for RMS 2022-23 in Punjab was 55.25 LMT, followed by Haryana 32.39 LMT, Madhya Pradesh 21.58 LMT and smaller quantities from Uttar Pradesh (0.51 LMT), Chandigarh (0.03 LMT), Rajasthan (0.01 LMT) and Uttarakhand (0.01 LMT).

However, there was zero procurement in Bihar, Delhi, Gujarat, Jharkhand, Maharashtra, Himachal Pradesh, Jammu & Kashmir, and West Bengal till April 20.

Last 12 years' data from FCI shows that the all India procurement for RMS22-23 of 109.78 LMT is nowhere near the annual all India procurement under RMS 2010-11 (225.13 LMT), RMS 2011-12 (283.34 LMT), RMS 2012-13 (382.15 LMT), RMS 2013-14 (250.72 LMT), RMS 2014-15 (281.31 LMT), RMS 2015-16 (280.88 LMT), RMS 2016-17 (229.61 LMT), RMS 2017-18 (308.24 LMT), RMS 2018-19 (357.95 LMT), RMS 2019-20 (341.32 LMT), RMS 2020-21 (389.92 LMT) and for RMS 2021-22, the procurement was 433.44 LMT.

Similarly for Punjab, the wheat procurement from RMS 2010-11 till RMS 2021-22 was (all in LMT) 102.09, 109.58, 128.36, 108.95, 116.44, 103.44, 106.49, 117.06, 126.92, 129.12, 127.14 and 132.22 respectively, again, far higher than 55.25 LMT procured till April 20 of this RMS.

Haryana story is no different. Wheat procurement from RMS 2010-11 till RMS 2021-22 was (all in LMT) 63.47, 69.28, 87.17, 58.55, 65.08, 67.78, 67.52, 74.32, 87.84, 93.20, 74.00, 84.93, almost more than double all years than 32.39 LMT till April 20 this RMS.

"One is that scores of farmers are yet to bring out their produce waiting for appropriate rates. Second, it is clear that much of the wheat is being diverted for private trading, obviously farmers and traders both want to profit in view of the good export prospects," officials said.

India has reported a wheat export worth of USD 2352.22 million in the last three years, including the first 10 months of current fiscal 2021-22.

Earlier last week, a report by the United States Department of Agriculture (USDA) had declared that Ukraine-Russia war led speculation surge for Indian export of wheat may bring down government procurement under Minimum Support Price (MSP).

It had pegged the marketing year 2022/2023 (April-March) wheat production at a record 110 from 30.9 million hectares, and up from last year's record 109.6 MMT from 31.1 million hectares.