Wheat procurement picks up but may face headwinds in some states

With Madhya Pradesh and Haryana, two big wheat procurers, expecting some revision in their purchase plans this year owing to farmers getting more than the minimum support price (MSP) from private players and the impact of rain in March on final yields, all eyes are now on the Central target of buying 34.2 million tonnes for the central pool in FY24.

After an initial lull, procurement has picked up steady pace in the past few days and, according to news agency PTI, till last week, the government procured 11.1 million tonnes in the 2023-24 marketing year (April-March), up from the 9.9 million tonnes in the year-ago period (up 12.12 per cent), according to the food ministry data.

These factors, traders said, will bring more wheat to domestic supplies and ensure higher than FY23 procurement in the central pool. 

In Madhya Pradesh, official sources said the state government hoped to purchase 7-8 million tonnes against an earlier target of 10 million tonnes, while in Haryana news reports said the state government expected procurement to be 6.5-7.0 million tonnes against the earlier target of 8.5 million tonnes.

 

“Wheat procurement is progressing smoothly,” a senior food ministry official told PTI.

By all reckoning, a situation akin to last year, when procurement for the central pool dropped to a multi-year low of around 18.79 million tonnes, is ruled out because the ban on exports is still in force; there is no added pressure from the Pradhan Mantri Gareeb Kalyan Yojana, which has not been extended after December 31; and the crop size is on the higher side than it was last year.