Three BJP-ruled states become challenge for the Centre in wheat procurement

Government procurement of wheat for Rabi Marketing Season (RMS) 2024-25 has gained momentum. According to the Central Foodgrain Procurement Portal, till now government agencies have procured about 202 lakh tonnes of wheat. This is about 10 percent less than the procurement done in the same period last year while it is 46 percent less than the target of purchasing 372.90 lakh wheat set for this year. 

The main reason for this decrease is less procurement in Madhya Pradesh, UP and Rajasthan. All three are BJP ruled states lagging behind the target in terms of wheat procurement for the central pool. 

Till now, the maximum purchase of about 95 lakh tonnes of wheat has been made in Punjab, whereas in the three states of Madhya Pradesh, Uttar Pradesh and Rajasthan together, less than 50 lakh tonnes of wheat has been purchased. In view of this, it has become challenging to achieve the target of wheat procurement. 

Wheat procurement in Punjab has lagged behind due to late harvesting but it is estimated that 130 lakh tonnes will be procured by the end of the season. But less purchase in Madhya Pradesh is worrying. 

Despite claims of record wheat production in the country last year, wheat procurement in Rabi season 2023-24 had come down to 261.97 lakh tonnes. Whereas in the year 2021-22 the procurement had reached 433 lakh tonnes. This time too, bumper wheat production is expected, in view of which wheat procurement was expected to increase. But the latest figures of government procurement present a different picture. 

Less purchase in Madhya Pradesh 

Madhya Pradesh, the country's leading wheat producing state, has so far purchased about 37 lakh tonnes of wheat, which is not even half of the target of purchasing 80 lakh tonnes of wheat. This is the situation even when the Madhya Pradesh government is giving a bonus of Rs 125 per quintal in addition to the MSP of Rs 2,275 on wheat purchase. But despite farmers getting a price of Rs 2,400, less purchases are being made. 

To increase procurement, the Madhya Pradesh government has extended the last date for purchasing wheat from farmers from May 15 to May 20. 

Also, by relaxing the quality norms for purchasing wheat soaked in rain and hailstorm, the limit of luster loss (loss of shine, spoilage and shrinkage of wheat grains) has been increased from 30 percent to 50 percent. Apart from this, the limit of broken wheat grains has been increased from six percent to 15 percent. 

Yield also affected in MP 

Wheat crop was damaged due to rain and hailstorm in Madhya Pradesh. The decline in wheat yield and production is also believed to be a major reason behind the decrease in procurement. Because the price of wheat purchase is Rs 2400, even private traders will not purchase more from Madhya Pradesh. In this respect also, government procurement should increase. But despite paying higher prices to farmers and relaxation in quality standards, the government procurement of wheat in the state is low, which is worrying. 

Yogesh Dwivedi, CEO of Madhya Bharat Consortium of FPOs, told Rural Voice that the wheat crop in the state has suffered 15 to 20 percent loss due to rain and hailstorm. At present, the arrival of wheat at procuremenrt centers is less, although the government has extended its time period and has also relaxed the quality norms. But despite this, it does not seem possible to achieve the target of government procurement of wheat in the state. In the expectation of higher price in coming days, farmers are not bringing their entire crop to the markets. 

UP and Rajasthan also have low procrement  

In Rajasthan too, wheat is being purchased at the rate of Rs 2400 with a bonus of Rs 125 per quintal. Till now 4.52 lakh tonnes of wheat has been procured in the state, which is more than the procurement done in the same period last year but is only 2.2 percent of the total wheat procurement in the country. 

Similarly, 5.97 lakh tonnes of wheat has been purchased in Uttar Pradesh, which is only 10 percent of the target of purchasing 60 lakh tonnes of wheat. Due to the wheat procurement price in Uttar Pradesh being lower than Madhya Pradesh and Rajasthan, farmers are stocking wheat in the hope of a good price instead of selling it immediately. This could be one of the reasons for reduced wheat procurement in UP, while unseasonal rains in Madhya Pradesh and Rajasthan have affected the yield. 

In total, about 48 lakh tonnes of wheat has been purchased in Madhya Pradesh, Rajasthan and Uttar Pradesh till April 30, whereas the target is to purchase a total of 160 lakh tonnes of wheat from the three states. Given the low procurement from these states, this target seems difficult to achieve. 

Increased dependence on Punjab, Haryana 

In such a scenario, the burden on Punjab and Haryana has increased. About 60 lakh tonnes of wheat has been purchased in Haryana whereas the target is to purchase 70 lakh tonnes of wheat. So far, about 155-160 lakh tonnes of wheat has been purchased from Haryana and Punjab, which can reach 200 lakh tonnes by the end of the season. In this way, the total procurement of wheat this year may be around 270 lakh tonnes. 

Maximum procurement of wheat takes place in the two months of April-May. The month of April has ended and the total procurement is about 171 lakh tonnes less than the target. Almost the same situation was last year when a total of 262 lakh tonnes of wheat was purchased whereas the target was set to purchase 341.50 lakh tonnes.