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April 27, 2024

Wheat Procurement for 2024-25 Shows Initial Dip, Expected to Accelerate Soon

Wheat procurement for the 2024-25 marketing year has commenced with a slight dip compared to the previous year’s figures. As of April 25, the total procurement is down by 17 per cent compared to the same period last year. This decline is attributed to late harvesting in major growing states and the influence of ongoing elections in North India.

However, officials remain optimistic that procurement will gain momentum once the factors affecting purchases stabilize. Despite the subdued start, wheat production for 2024-25 is expected to exceed 112 million tonnes nationwide, according to the second advance estimate.

The decrease in procurement may also be linked to farmers holding onto their produce in anticipation of higher prices later in the year. Additionally, private players are actively replenishing their inventories, contributing to the lower government procurement in some states. In states like Uttar Pradesh, private players are restrained from aggressive purchasing as long as government procurement continues, resulting in a 397 per cent increase in purchases compared to last year.

India aims to procure around 37 million tonnes of wheat this year, a significant increase from last year’s 26 million tonnes. This robust procurement is crucial for ensuring adequate supplies for the government’s free food grains distribution scheme, the Pradhan Mantri Gareeb Kalyan Ann Yojana (PMGKAY), and for stabilizing domestic wheat prices.

Moreover, the replenishment of wheat reserves is imperative, as they have dwindled to multi-year lows as of April 1, 2024.

Wheat procurement typically begins on April 1, but this year it commenced around March 15 in some states, and the process will continue until June 30 in most regions. The Food Corporation of India (FCI) has estimated procurement of 37.2 million tonnes of wheat for this year, marking a significant increase from the actual procurement of 26.19 million tonnes last year.

In conclusion, while the initial procurement figures for wheat in 2024-25 indicate a slight dip, the prospects for acceleration are promising. With government initiatives, the influence of ongoing elections waning, and private players actively participating, the procurement is expected to pick up soon, ensuring stable food distribution and prices across the nation.

Jhumpa Lahiri

Jhumpa Lahiri

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