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FCI is in good position to meet procurement target: chairman

FCI is in good position to meet procurement target: chairman
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First Published: Sat, Mar 31 2007. 12 09 AM IST
Updated: Sat, Mar 31 2007. 12 09 AM IST
New Delhi: Putting past failures in wheat procurement behind it, the Food Corporation of India (FCI) on Friday said favourable conditions this year would enable the nodal agency to meet the target of 151 lakh tonnes for 2007-08 marketing season.
“We have no doubt about procuring more than 150 lakh tonnes of wheat this year,” FCI chairman and managing director Alok Sinha said.
FCI could only procure 92.26 lakh tonnes of wheat last year against the targeted 162.07 lakh tonnes due to aggressive buying by private and multinational companies, forcing it to import the foodgrain.
Sinha said the wheat stock position would be comfortable this year at around 200 lakh tonnes, including the opening buffer stock of over 50 lakh tonnes.
This is against a requirement of over 160 lakh tonnes for PDS and other welfare schemes.
Sinha said higher production, competitive purchase price and lower global prices of wheat this year would make the task of wheat procurement easier for FCI.
The procurement in major wheat-producing states would be in full swing after 10 April although the process would start from 1 April, he said.
Pointing out that there was a lot of speculation in the market that procurement would be low like last year, Sinha said the “situation is different” this year and FCI is in a better position to meet the target.
He said it has been found that private wheat traders buy less when the buffer stocks at FCI godowns are high.
“Last year, the buffer stock on 1 April was only 20 lakh tonnes, while this year it will cross 50 lakh tonnes. Moreover, the country will be producing 40 lakh tonnes more wheat,” Sinha said, adding the output is expected to cross 73 million tonnes during 2006-07.
Besides, the effective purchase price including bonus has become competitive at Rs850 per quintal compared with last year’s procurement price of Rs700 per quintal, he said.
The international prices currently are ruling at $170 per tonne, which is $30 less than last year’s rate, he said.
He said about 10,000 purchase centres would start functioning from 1 April in Punjab, Haryana, Rajasthan, Uttar Pradesh, Uttarakhand, Madhya Pradesh and Bihar.
“We have enough cash and gunny bags for smooth procurement and also adequate storage at different places,” Sinha said.
The FCI chief said the agency has a total of Rs35,000 crore cash credit limit per day with different banks for undertaking procurement of wheat, rice and other foodgrains.
A day after agriculture minister Sharad Pawar said that there was no restriction on private traders who want to buy wheat from the market, Sinha also said the agency was not against private companies.
“Our objective is to ensure that farmers get a better price and there is no distress sale below the purchase price of Rs850 per quintal,” he said.
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First Published: Sat, Mar 31 2007. 12 09 AM IST
More Topics: Money Matters | Commodities |