New Delhi: India, forced to import wheat after a gap of six years in 2006 following a poor crop, expects a bumper output of around 74 million tonnes this year due to good weather conditions, government officials said.
The forecast is at least one mt more than previous estimates and sharply up from the 2006 output of 69.4mt.
Wheat prices in India have shot up on a supply squeeze. Last week, the government banned futures trade in wheat and rice, after politicians blamed speculation for fuelling prices and adding to inflationary pressures.
“Production may reach 73.5 million tonnes on extremely good weather conditions,” agriculture minister Sharad Pawar said.
The minister said there was major expansion in area under wheat in Punjab, Haryana, Uttar Pradesh, Gujarat and Madhya Pradesh.
“Unlike last year when we had three to four weeks of bad weather in February, conditions have been favourable this time,” Pawar said.
Food secretary T. Nanda Kumar said output was likely to be much higher than earlier estimates.
Alok Sinha, managing director of Food Corporation of India (FCI), said the state-run grains agency expected good purchases from farmers, based on a wheat crop estimate of 74mt.
Sinha said the agency expected to procure about 13mt of wheat from farmers this year to augment government stocks and meet demand for welfare schemes.
The country was forced to contract for imports of 5.5mt of wheat at high costs after procurement in 2006 fell sharply to 9.2mt against a target of 16mt.
“As of 1 April, we are expecting stocks of 4.5 million tonnes against 2 million tonnes last April,” Sinha said.
Procurement starts in April and lasts for more than a month.
“Our target is 12 million tonnes stocks for FCI, but we are likely to cross 17 million tonnes by May,” he said.
Bulk purchases of the commodity from farmers at higher prices by private players were blamed for low government procurement in 2006.
Pawar denied media reports that the government has asked private players not to procure wheat from the main growing regions this year.
“In a democracy no one can be prevented,” the agriculture minister said. “There is no possibility of preventing private players from procuring wheat.”
Kumar said actual imports may be about 40,000-50,000 tonnes less than the contracted 5.5mt.
Most of the wheat from Australia and other destinations have already arrived at Indian ports.
“There is a clause in the import contracts that it could be a little less or more,” Kumar said.
He said the government would look at removing regulations, like imposition of stock limits on wheat, if it was able to manage things comfortably this year.
Both Pawar and Kumar dismissed media reports the government was planning to deregulate the sugar sector and do away with a requirementfor mills to sell part of the sugar output to the government as levy.
“There is no such proposal. We have not given a thought to it, there is no such move,” Pawar said.