Wheat stock overflows as rabi procurement in Punjab tops 11.5 million tonnes

Government procurement of wheat in Punjab during the current rabi marketing season 2010-11 is estimated to have reached 11.5 million tonnes, with FCI buying 1.62 million tonnes and state agencies procuring the remaining 8.35 million tonnes, as of 5 May.

The government has so far procured a total of 20.44 million tonnes of wheat as of 5 May 2010 in RMS 2010-11, minister of state for agriculture, consumer affairs, food and public distribution KV Thomas stated in a written reply in the Rajya Sabha on Friday.

The heavy procurement of wheat in RMS 2009-10 and 2010-11 has resulted in a shortage of storage space in Punjab. For meeting this shortfall, state-run agencies have resorted to hiring of storage space - both covered and covered and plinth (CAP) - from other state agencies as well as private sector, including rice mills, sugar mills and mandi yards, the minister said.

He said FCI and state agencies have hired storage capacity - both covered and covered plinth - from private parties as per their requirements. Executive directors (zone), FCI have been delegated full powers to hire storage capacity from private parties for three years extendable by two years as per need/requirement.

The government is procuring wheat at the current minimum support price (MSP) of Rs1100 per quintal. Against this, the minister said, the landed cost of imported wheat from Australia is Rs1105.20 per quintal at Tuticorin port excluding other charges. The landed cost of imported wheat from the US at Indian ports is Rs1,222.70 per quintal excluding other charges.

The stock position of wheat at the central pool is comfortable, and the MSP has been kept higher to make it remunerative, the minister stated.