New Delhi: The Indian government has bought around 9.6 million tonnes (mt) of new season wheat from farmers as market arrivals pick up, raising hopes it can build healthy buffer stocks from domestic grain purchases.
Buying had earlier dipped with grain not reaching the market on time as farmers turned to manual harvesting to maximize the yield of straw, widely used as fodder. Domestic fodder prices have recently firmed.
“We have procured 9.59mt until Monday against 9.2mt bought in the year-ago period,” an official of the Food Corp. of India, which buys the grain, said. “We now hope to procure 11-12mt until 31 May, when the procurement programme ends,” another official said.
India needs 12mt of wheat annually to run a public distribution system and welfare schemes for the poor. Low wheat purchases by the state-run grain procurement agency forced India to order expensive imports totalling 5.5mt in 2006.
The slow pace of buying earlier this year forced the government-owned State Trading Corp. (STC) last month to float a tender to import 1mt.
Union agriculture minister Sharad Pawar had said India might import 4-5mt of wheat this year to build stocks to meet any sudden spurt in demand. The second official said imported grain would cost roughly the same as domestic wheat.
“Transportation from main producing states in the North to the South costs more than importing through ports in southern India,” the official said.
India, the world’s second-largest wheat producer, grows only one wheat crop a year, mainly in Punjab, Haryana, and Uttar Pradesh and Madhya Pradesh.