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Informist, Wednesday, Sep 18, 2024

 

MUMBAI – Import of 2-3 mln tn of wheat is necessary to bring down domestic prices of the grain, former Union agriculture secretary Siraj Hussain said at The Wheat Summit in Mumbai today.

 

"I don't understand why imports are not happening," Hussain said. "I have myself written to the government several times. The prices in other commodities are rising in sympathy of higher prices here... Food inflation is being passed on from one commodity to another." According to the former bureaucrat, the rising prices of wheat will have an impact on the prices of maize, rice, and other commodities.

 

Currently, wheat prices in Delhi are at 2,840 rupees per 100 kg and those in the benchmark market of Kota in Rajasthan are at 2,600-2,650 rupees per 100 kg. 

 

Questioning the government's production numbers, the former secretary said about 5 mln tn of cereals are "missing" in the country. "According to the NSSO (National Sample Survey Office) consumption data which was recently released, there should have been no double-digit inflation in wheat and rice. Which means either the NSSO consumption data is understated or the production data is overstated... Now you know better which one is overstated," he remarked.

 

While the government estimates wheat production for 2023-24 (Apr-Mar) at 112.9 mln tn, traders estimate it to be between 100 mln tn and 104 mln tn.

 

As of Sep 1, the government's wheat stocks have fallen 3.3?low the Jul-Sep buffer norm of 27.58 mln tn to 25.10 mln tn, mainly on account of lower procurement during Apr-Jun, when the government could not meet its target of procuring 30-32 mln tn for rabi marketing season 2024-25 (Apr-Mar). Procurement of wheat by the government ended on Jun 30, with the Centre managing to buy only 26.60 mln tn from farmers.

 

However, Hussain said, the situation of shortage of wheat can easily be managed by lowering import duty. "There is a sense of panic among millers in South India," the former bureaucrat said. "I keep receiving calls from them that wheat is not available and that they are trying to get it from Uttar Pradesh. This can easily be mitigated by lowering the import duty." The import duty is currently pegged at 40% of the import price, making it unviable even for the biggest traders.

 

The government, on Friday, reduced stock limits for traders/wholesalers to 2,000 tn, from 3,000 tn earlier, and for wheat processors to 60% of their monthly installed capacity multiplied by the months remaining in the financial year ending Mar 31. No change was made in the stock limits for retailers, which remain at 10 tn. The stock limit for big chain retailers was also retained at 10 tn per outlet, but the total wheat big retail chains can hold was revised to 10 times the total number of outlets, from 3,000 tn earlier.  End

 

Reported by Pallavi Singhal and J. Navya Sruthi

Edited by Rajeev Pai

 

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