Ministry says wheat sales to continue

The food ministry today indicated that it would continue to sell wheat in the open market from the Central grain pool in view of the comfortable stock position.

It also indicated that it would not pursue its earlier proposal to the Cabinet for slashing the supply of foodgrains to below poverty line (BPL) households.

Talking to newspersons, food secretary S K Tuteja said though the procurement of wheat this year might fall short of last year's 16.79 million tonne by around two million tonne, the total stocks available with the government would still be adequate to meet the requirement for various purposes.

Nearly 14.8 million tonne of wheat had already been procured in the current rabi marketing season. With the carryover stock of around 4.1 million tonne from last year, the total wheat availability this year would be around 18.8 million tonne.

The wheat requirement on the other hand was expected to be maximum 17 million tonne, including around 12 million tonne for the public distribution system (PDS), between 1.5 and 2.0 million tonne for welfare schemes and around one to 1.5 million tonne for the rural development ministry's employment oriented schemes.

The government, therefore, did not anticipate any shortage of wheat though it was not averse to resort to imports, if the need arose, he pointed out.

Though the wheat-based industry in the south had earlier approached the government to facilitate wheat imports at the southern ports, but it was no linger keen to pursue with this demand, Tuteja revealed.

"We will continue the open market sale scheme of selling wheat from official stocks to the private trade at the pre-determined prices. So far, no sales had taken place this year because the ruling market prices are lower than those fixed by the Food Corporation of India (FCI) for open market sales. However, we would not give wheat from official stocks for exports," he stated.

When asked whether higher purchases by the private trade and deferring the wheat sale by farmers in anticipation of better prices were responsible for lower wheat procurement, the food secretary said it could be true.

"But, the government do not mind if the private trade buys wheat at higher than the minimum support price," he added.

Tuteja discounted the impression that futures trading of wheat was responsible for higher wheat prices. "The prices would ultimately be determined by demand-supply scenario", he maintained.

Regarding rice, he said the total procurement this year would be about a million tonne higher than last year's 22.8 million tonne.

The procurement had already touched 22.4 million tonne and four months of procurement period was still left. The FCI, therefore, was likely to mop up around 23.8 to 24 million tonne of rice.