Wheat glut in Punjab grain markets

April 23rd, 2008 - 11:02 am ICT by admin  

By Jaideep Sarin
Khanna (Punjab), April 23 (IANS) Grain markets across Punjab are facing a problem of plenty as a near bumper crop has taken wheat arrivals to a new high. With the central and Punjab government agencies targeting a procurement of over eight million tonnes of wheat this season, the collections this time will be well above the procurement of 6.9 million tonnes last year.

Market committee managements here and in other grain markets like Sangrur, Barnala, Ropar and Kharar are asking procurement agencies to lift their secured stocks immediately as wheat arrivals were picking up further, causing a glut and resultant chaos in the grain markets.

“My wheat is still on tractor-trolleys as there is no space to off-load it in the grain market,” farmer Dalbir Singh told IANS here.

State agencies procured 555,000 tonnes of wheat Saturday (April 19) while the figure for the corresponding day the previous year stood at 459,000 tonnes. The trend continued Sunday with nearly 600,000 tonnes of wheat being procured - a record of sorts for a single-day procurement.

Over 95 per cent of the nearly 3.6 million tonnes of wheat has been procured from the farmers by central and state government procurement agencies even as private buyers have shown only a symbolic presence in the purchase market.

Punjab government officials at various grain markets - including the largest one in Asia located here - say that the private buyers have not entered the market this time in a big way as they did in the last two years.

“One of the reasons for that could be that any private trader lifting stocks of more than 10,000 tonnes has to file a return with the government and anyone buying above 15,000 tonnes has to seek prior permission of the government,” one official here pointed out.

Private buyers are mainly flour companies and bread and other foodstuff manufacturers.

“Wheat procurement in Punjab is all set to exceed the figure achieved last year. Despite the delayed start in procurement due to bad weather and rains over the region, the target is expected to be surpassed this time,” Punjab government spokesman Harcharan Bains said.

Bains attributed the decline in purchase by private agencies to the strict vigil being kept by the government against hoarding and black-marketing tendencies.

The six government agencies involved in procurement include the Food Corporation of India and five agencies of the Punjab government. Bulk of the purchase is done by the Punjab agencies which later contribute their share to the central pool for the buffer stock.

These agencies have already released over Rs.20 billion to farmers for the procured wheat. Payments to farmers have to be made within 72 hours of each purchase.

The Punjab government is likely to end up making payments of over Rs.100 billion to farmers this wheat season. The Reserve Bank of India has already sanctioned Rs.85 billion to the state government for procurement.

Tags: , , , , , , , , , , , , , , , , , , ,

Posted in Business |