India has no plans to import wheat because it has enough stocks to meet domestic demand, the Department of Food and Public Distribution clarified on Sunday, following a media report that India was likely to begin importing the staple foodgrain.
"No such plan exists to import wheat into India. The country has sufficient stocks to meet our domestic requirements, and FCI has sufficient stock for public distribution," the department responded to the news item on Twitter. Earlier this year, multiple rounds of heat waves in several wheat-growing regions of India affected some wheat crops ahead of the rabi harvest.
According to the fourth advance estimate of major agricultural crop production released by the Union Ministry of Agriculture and Farmers Welfare, wheat production during 2021-22 is estimated at 106.84 million tonnes, up from the previously reported estimate of 111 million tonnes.
As tensions between Russia and Ukraine escalated into a full-fledged war, wheat export demand increased, resulting in lifetime high prices for the staple foodgrain in the local mandis. Price increases were also caused by crop loss due to the heat wave. Notably, both of the countries involved in the conflict, Ukraine and Russia, are major wheat suppliers.
Wheat prices in Indore, Madhya Pradesh, which is considered one of the key mandis, reached Rs 2,400-2,500 per 100 kg, up from Rs 2,000-2,100 before the Ukraine conflict broke out. Wheat prices typically remain low during this time of year as freshly harvested rabi crops make their way into physical markets or mandis.
Nonetheless, the current wheat price in India is well above the Centre's guaranteed Minimum Support Price of Rs 2,015 per 100 kg, which is a rare occurrence. Wheat is currently trading in Indore for slightly less than Rs 2,400 per 100 kg. Wheat prices have softened in other markets as well.
However, wholesale wheat prices in domestic mandis have recently fallen from lifetime highs and have stabilized as the central government timely implemented a slew of policy interventions on foodgrain exports. For the record, in order to manage the country's overall food security as well as meet the needs of neighbouring and other vulnerable countries, India changed its wheat export policy by categorizing its export as "prohibited."
While prohibiting wheat exports, the government stated that the move was made to manage the country's overall food security as well as meet the needs of neighbouring and other vulnerable countries. The Indian government did not stop at restricting wheat exports.
Following a ban on wheat grain exports, the Centre imposed restrictions on wheat flour (atta) exports and other related products such as maida, semolina (rava/sirgi), wholemeal atta, and resultant atta.
In response to another question about whether wheat procurement from farmers has decreased since a rise in private procurement that bought wheat directly from farmers, the minister agreed. "Wheat procurement has decreased due to increased purchases of wheat by traders as the market price of wheat has risen due to the current international geopolitical situation," the Union minister said.
"Moreover, if the farmer receives a higher price than the MSP, they are free to sell their produce in the open market." Wheat prices rising above MSP imply that the Centre was forced to purchase fewer quantities under the price guarantee scheme because farmers are already receiving higher prices from private buyers.
