Wheat procurement falls 18% to 22.9 mt as lower arrival bites

Procurement has fallen due to lower arrival of wheat this year at about 25.6 million tonnes as against over 31 million tonnes last year

Wheat procurement has taken a hit as it has declined 18% to 22.9 million tonnes so far in the current 2016-17 marketing year (April-March), following lower arrival of grains in the market despite forecast of a higher output 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 million tonnes of wheat in the 2015-16 marketing year but 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 million tonnes as against over 31 million tonnes 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 million tonnes as on July 1.

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

According to Agriculture Ministry's third advance estimate, India'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.