The government has exceeded its wheat procurement target of 15 million tonnes during the ongoing rabi season so far and is hopeful of setting a five-year record by lifting 18 million tonnes for the public distribution system.

Data from the department of food and public distribution reveals that government agencies have procured 15.42 million tonne wheat on 1 May as compared to 8.24 million tonnes during the same period last year. The government had been forced to resort to importing 7.3 million tonnes of wheat in the last two years to augment public distribution.

Statewise procurement of wheat so far is as follows:

• Punjab 82.9 lakh tonnes
• Haryana 46.5 lakh tonne
• Madhya Pradesh 9.5 lakh tonne
• Uttar Pradesh 8.2 lakh tonne
• Rajasthan 5.5 lakh tonne
• Gujarat 1.1 lakh tonne.
• Other states where procurement of wheat has taken place include Bihar, Chandigarh, Uttarakhand and Delhi.

Out of 15.42 million tonne, the Food Corporation of India (FCI) procured 2.77 million tonnes.
The pace of procurement in the current season is also faster as compared to that in the last season:

 MP:CP: wheat procurement as of 2 May 2008

The government expects the higher procurement to not only ease the supply-side constraints but also ease wheat prices.

The higher procurement has been attributed to a higher minimum support price (MSP) for wheat of Rs1,000 a quintal for wheat this year, against Rs850 last year and lower procurement by private trade and multi-national companies.

Also, apart from traditional major contributors such as Punjab and Haryana, states such as Madhya Pradesh, Uttar Pradesh, Rajasthan and Gujarat have returned substantial quantity of wheat to the central pool this year.

Private traders and multi-national organisations have so far procured only 1.2 million tonnes, against 3.9 million tonnes last year.

According to FCI officials, at best private trade may procure up to two million tonnes this year. They did not procure higher quantities because of the narrow price differential and the order on declaration of stock holding.