Wheat procurement so far almost 30% lower than last year, say traders

Heavy private purchases in main producing states of Madhya Pradesh and UP cited as reason

Wheat procured for the Central pool in the first 11 days of the 2022-23 marketing season that started from April 1 is said to have fallen by almost 30 per cent as compared to the same period last year due to heavy private purchases in main producing states of Madhya Pradesh and UP, trade sources said.

They said that till April 11, around 2.05 million tonnes of wheat had been purchased for the central pool which during the same period last year was 2.89 million tonnes.

Madhya Pradesh, which has emerged as one of the main destinations of export this year has purchased around 0.49 million tonnes of wheat from farmers this year till April 11, which is significantly lower than the 1.19 million tonnes purchased during the same period last year.

Wheat prices in several markets across India are ruling at almost Rs 100-300 per quintal over the Minimum Support Price (MSP) of Rs 2015 per quintal due to strong export demand.

The Central government has fixed a target of purchasing around 44.4 million tonnes of wheat this year from farmers, but sources said that if the current trend continues for another few months, actual procurement could be significantly less at around 30-34 million tonnes.

This should be good news for the government which is looking to prune its bulging grain stocks and also lead to subsidy savings.

Around 45-46 per cent of the Centre’s annual food subsidy is on account of wheat.

Meanwhile, on exports, sources said that the government has targeted to export over 10-11 million tonnes of wheat in FY23, up from 7.85 million tonnes due to strong global demand in light of the Russia-Ukraine crisis. EoM