FCI not to buy wheat from mandi brokers in UP
The Food Corporation of India (FCI), the government’s grain-buying arm, has decided to keep out mandi brokers while buying wheat from top grower Uttar Pradesh this season.
By Nidhi Nath Srinivas, ET Bureau |
NEW DELHI: The Food Corporation of India (FCI), the government���s grain-buying arm, has decided to keep out mandi brokers while buying wheat from top grower Uttar Pradesh this season. This will reduce the total quantity bought from the state by at least 1 million tonne in a year when record amount of unsold wheat is already lying in FCI godowns.
In the new wheat marketing year starting April 1, FCI will not buy wheat procured by mandi arhtiyas. Instead, farmers will have to sell their wheat directly to depots set up by FCI and state buying agencies. This is expected to discourage the smaller growers, who find it more convenient to sell grain at farm gate to arhtiyas instead of transporting it to the nearest FCI depot.
Last year, FCI had encouraged purchase by arhtiyas because there was urgent need to fill up government grain godowns and prevent a shortage in ration shops. This season, the reverse is true. ���State procurement agencies say they will pick up 3 million tonnes of wheat from UP this season. But if arhtiyas are kept away, the figure could drop to 2 million tonnes,��� said a senior food ministry official, who did not wish to be named.
The last thing FCI wants now is to have excess grain on its books, which is bought at a high price but will steadily loses value as the months pass. But FCI���s move may come as a blow to millions of growers in UP, who have sown 3 lakh hectares extra with wheat this season. The state has India���s maximum acreage under wheat at 9.5 million hectares.
Apart from Bihar, UP has immense potential to increase wheat production. Wheat acreage and yield are now virtually stagnant in Punjab and Haryana, hitherto considered India���s wheat basket. Private grain companies are reluctant to procure wheat from Uttar Pradesh because the state has been strictly enforcing the rule that allows buying only at MSP.
Moreover, there is little scope in stocking wheat this season when supply is abundant. Farmers may, therefore, find it tough to find buyers willing to pay good prices.
In the new wheat marketing year starting April 1, FCI will not buy wheat procured by mandi arhtiyas. Instead, farmers will have to sell their wheat directly to depots set up by FCI and state buying agencies. This is expected to discourage the smaller growers, who find it more convenient to sell grain at farm gate to arhtiyas instead of transporting it to the nearest FCI depot.
Last year, FCI had encouraged purchase by arhtiyas because there was urgent need to fill up government grain godowns and prevent a shortage in ration shops. This season, the reverse is true. ���State procurement agencies say they will pick up 3 million tonnes of wheat from UP this season. But if arhtiyas are kept away, the figure could drop to 2 million tonnes,��� said a senior food ministry official, who did not wish to be named.
The last thing FCI wants now is to have excess grain on its books, which is bought at a high price but will steadily loses value as the months pass. But FCI���s move may come as a blow to millions of growers in UP, who have sown 3 lakh hectares extra with wheat this season. The state has India���s maximum acreage under wheat at 9.5 million hectares.
Apart from Bihar, UP has immense potential to increase wheat production. Wheat acreage and yield are now virtually stagnant in Punjab and Haryana, hitherto considered India���s wheat basket. Private grain companies are reluctant to procure wheat from Uttar Pradesh because the state has been strictly enforcing the rule that allows buying only at MSP.
Moreover, there is little scope in stocking wheat this season when supply is abundant. Farmers may, therefore, find it tough to find buyers willing to pay good prices.
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