Date:19/04/2007 URL: http://www.thehindubusinessline.com/2007/04/19/stories/2007041904571200.htm

Back Govt agencies buy 35.45 l tonnes wheat

Harish Damodaran

New Delhi April 18 Even the most pessimistic of wheat watchers agree that the 2006-07 crop currently being marketed is bigger than the previous year's harvest. The latest official estimate pegs the size at 73.7 million tonnes (mt), up from the 69.35 mt of 2005-06.

But despite the bumper crop projections, wheat arrivals in mandis have so far hardly kept pace. As on Wednesday, 46.81 lt of wheat had arrived in the country's major markets during the ongoing 2007-08 marketing season (April-June). This is below the 68.23 lt that came during the corresponding period of 2006-07. Of the total arrivals, the Government agencies have mopped up 35.45 lt, down from last year's 56.46 lt.

More pertinent, cumulative arrivals have been lower in the two "granary" States of Punjab (23.35 lt versus 41.54 lt) and Haryana (15.47 lt versus 20.98 lt), with the corresponding governmental procurement levels also showing a fall (21.21 lt versus 38.11 lt and 14.17 lt versus 18.23 lt, respectively).

How does one explain this divergent trend? One reason, officials say, has to do with delayed harvesting. Last year, the early onset of summer resulted in premature ripening of the grain, whereas the favourable weather conditions this time has enabled the crop to grow to its full maturity cycle. That, in turn, has not only boosted yields, but also pushed forward the harvesting season.

"We are in for an extended harvesting period. But ultimately, we believe that arrivals would end up higher and procurement will exceed not just last year's 92.25 lt, but even the target of 151 lt," the officials claimed. In fact, in Madhya Pradesh (where the crop is harvested relatively early), progressive arrivals so far, at 5.06 lt, have already overtaken last year's corresponding 3.51 lt.

It is another matter that the Government agencies have bought a mere 721 tonnes out of the mandi arrivals, with the rest being purchased by private players. "The trend this time would be that there will be enough wheat for everyone. While the Government would mainly buy from Punjab, Haryana and, to some extent, Uttar Pradesh, the private trade will focus on Madhya Pradesh and Rajasthan, where the levies as well as freight costs to the deficit regions are lower," the officials added.