Centre Eases Wheat Procurement Regulations in Punjab & Haryana to Support Farmers

According to sources, the food ministry team discovered that moisture content in wheat arriving in mandis was as high as 20% at various locations in Punjab and Haryana, and the grains had also lost their lustre.

The Food Corporation of India (FCI) and state agencies purchase wheat at the Minimum Support Price (MSP) with a maximum moisture content of 12% under fair and average quality standards.

In a communication to the food ministry last week, the Punjab government requested a relaxation in wheat procurement specifications, allowing the purchase of 6% damaged grain, up to 12% slightly damaged grains, up to 15% broken grains, and 100% lustre loss.

On March 31, the food ministry relaxed procurement rules, allowing the purchase of grains with lustre losses of more than 10% from farmers in Madhya Pradesh at a marginal value cut of only Rs 5.31/quintal, compared to the MSP of Rs 2,125/quintal for the current season.

"This relaxation of norms would assist farmers in dealing with the distress sale of grain that has been impacted by rains this month," a food ministry official said. Since the current season's MSP operations officially began on April 1, the FCI and state agencies have purchased approximately 0.7 million tonnes (MT) of wheat.

 The majority of wheat purchased from farmers in the current marketing season (April-June) has come from Madhya Pradesh, with a small amount coming from Punjab, Haryana, and Uttar Pradesh.

Officials expect wheat arrivals and procurement to pick up by the middle of this month, as unseasonal rains in key wheat-growing states since mid-March have damaged crops in some places while also delaying harvest.

 The government's wheat procurement fell by more than 56.6% last year, to 18.8 MT, compared to 43.3 MT in 2021, due to increased output due to a March temperature spike and an increase in private purchases due to global demand.

The government has stated that it expects 112 MT of wheat production in the current crop season (July-June), but has ruled out any significant reduction in grain output due to recent unseasonal rains in key states.

Meanwhile, the Roller Flour Millers' Federation of India predicted 102.89 MT of wheat production in the current crop year in a survey report. Wheat held by FCI has dropped to 8.51 MT, just above the April 1 buffer of 7.4 MT. Wheat stocks are currently at their lowest level since 2017.

To replenish the stock, the FCI and state agencies must purchase at least 30 MT of wheat from farmers during the April-June 2023 season, ensuring that enough grains are available for the implementation of the National Food Security Act and the creation of adequate buffer stock. FCI must have a wheat buffer of 27.57 MT by July 1.