Government raises rabi wheat procurement target by 10%

During the previous season India procured 22.96 mt

The government has fixed a target to procure 33 million tonnes of wheat this rabi season, almost 10% higher than last year.

The decision was taken on Wednesday at a meeting of state foiod secretaries, chaired by Preeti Sudan, secretary at the central government's department of food & public distribution. A record output is estimated this time.

The previous rabi season saw 22.96 mt of wheat procured. A little over 80% of the buying will come from Punjab, Haryana and Madhya Pradesh

The second Advance Estimate of the ministry of agriculture was a record 96.64 mt, as compared to 92.29 mt in 2015-16. Imports have increased, following zero import duty, and record output has farmers relying on state agencies for procuring before prices crash. There are indications that the Centre will restore the import duty once state agencies start buying in full force and the new crop comes into the market. "This abolishing of import duty is a temporary measure," a senior finance ministry official had told a group of reporters some time earlier.

For 60-year old Ramesh Tyagi in Shamli, UP, the cloud surrounding this year's rabi production due to the cash crunch from demonetisation just during the peak sowing season seems to be abating. With god weather, his eight acres of wheat crop is in a healthy condition. For millions like him across northern India, the standing crop offers hope of a good return; last year's harvest was hit by unseasonal rain and hail around March, the peak harvest time.

Last year, when wheat flour (atta) prices reached around Rs 30 a kg, the government cut the import duty to zero in two stages. If import duty is not restored, wheat farmers this year might be at the mercy of state agencies, as private trade is not expected to actively buy, having filled their inventories through import.