New Delhi: India, battling spiralling prices of staple foods, has sufficient reserves of wheat and rice to meet emergencies, giving the government room to release stockpiles to curb inflation, the nation’s biggest buyer of grains said.
The country may have 22 million tonnes (mt) of rice and 5.5mt of wheat stored in warehouses by 1 April, state-owned Food Corporation of India (FCI) chairman Alok Sinha said in New Delhi. The government needs at least 12.2mt of rice and 4mt of wheat for distribution among the poor.
Minister for commerce and industry Kamal Nath said on Monday that the cabinet may consider ways to curb wheat prices that were climbing along with other commodities at a time when more than three years of interest-rate is increasing and a global economic slowdown is threatening to disrupt India’s record expansion. Wheat and rice are the best performing commodities in the past year on the Rogers International Commodity Index. “The overall grain situation is comfortable,” Sinha said.
The government has curbed exports of wheat, rice and cooking fats, joining China, Malaysia and Indonesia in safeguarding supplies.
Rough rice prices have almost doubled on the Chicago Board of Trade in the past year, threatening food security across Asia. The Philippines, the world’s biggest rice buyer, is cracking down on hoarders, while leading cereal exporters such as China, Vietnam and Egypt are curbing supplies.
Rice costs $20.17 per 100 pounds (45kg), from about $10 a year earlier, while wheat has jumped to $9.945 a bushel in Chicago from $4.58 over the past 12 months. Record global prices prompted India’s government to raise the minimum price it pays wheat growers by 18% to Rs1,000 for 100kg. Wheat, harvested in March and April, accounts for 73% of the winter foodgrain output.
FCI plans to buy 15mt from growers this year, unchanged from the target announced last month. The state agency has bought 100,000 tonnes from this year’s harvest, Sinha said.
India imported 1.8mt of wheat last year to meet rising demand.
The country, also the world’s second biggest wheat grower, may gather 74.8mt in the March-April harvest, 1mt less than last year, the ministry had said last month.