Wheat procurement down by 54%, likely to hit 13-year low

The government’s wheat procurement in the current year down by more than 54% on year to 18.65 million tonne (mt) till Tuesday. With an arrival of only around 81,000 tonne of wheat on Tuesday in mandies mostly in Uttar Pradesh and Madhya Pradesh, purchase of the grain by the Food Corporation of India (FCI) and other organizations at the Minimum Support Price may not touch 19 mt against 43.34 mt purchased last year during rabi marketing season.

Punjab and Haryana, which put up close to 74% of the total wheat procurement so far, closed their procurement operations on Tuesday. In Uttar Pradesh, Madhya Pradesh and Rajasthan, procurement of wheat by agencies would continue for the next two weeks. In other wheat-growing states like Uttar Pradesh, Rajasthan, Uttarakhand and Gujarat, the volume of grain procurement this year has seen a sharp downfall.

On the lower volume of wheat procurement, the food ministry had mentioned factors such as farmers in Madhya Pradesh, Uttar Pradesh and Gujarat selling to traders and exporters at `2,100-2,400 a quintal against the MSP of `2,015 a quintal prior to the government imposing ban on shipment on May 13. This means the purchases of the grain by the government at MSP would hit a 13-year low this year.

The central government had revised the estimate of wheat production in the 2021-22 crop year (July-June) to 106 mt, down from its February projection of 111.32 mt in the third advance estimates of food grain production released last month.

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