India: Wheat’s share in free supply of food grains raised

Two years after the government had cut allocation of wheat to ten states, the government on Wednesday announced partial restoration of wheat entitlements to the beneficiaries under the Pradhan Mantri Garib Kalyana Anna Yojna (PMGKAY) by allocating 3.5 million tonne (MT) of the grain, instead of rice, till end of FY25.

Currently, the Food Corporation of India (FCI) supplies 18.5 MT of wheat annually to meet the obligation under the food security law and other welfare schemes. After this restoration, the annual wheat allocation to PMGKAY or free ration scheme will rise to 22 MT, but will be short of the 28 MT used to be allocated prior to May, 2022. Annually the government allocates around 36 MT of rice under the free ration scheme.

Sources said the new allocation from next month is expected to help 200 million people mostly in states including Haryana, Uttar Pradesh, Gujarat, Maharashtra and Jharkhand to get 5 kg of wheat, each every month.

Food secretary Sanjeev Chopra said currently around 10 MT of wheat available with the traders as per a ‘conservative’ estimate , which is higher as compared to the same time last year.

In May, 2022, the government had cut wheat allocation allocation to 10 states with additional allocation of rice following sharp fall in wheat procurement due to fall in output due to wheat wave prior to the harvesting season. The government had also banned wheat exports two years back.

Meanwhile, Chopra also ruled out resumption of open market sale operations of wheat to bulk buyers from the FCI’s stock as there is ample wheat available in the country. “Wheat prices are stable and there is no shortage as the country had a bumper output last year,”.

At present, FCI has 24.56 MT of wheat stock against the buffer of 20.52 MT for October 1. The government has allocated 2.5 MT of wheat to be sold in the market aimed at curbing rise in prices, however open market sale would resume when required, Chopra said.

Last year, the FCI had commenced open market sale operations from June and had offloaded a record 10 MT for bulk purchaser in FY24.

In June, the government had imposed stock holding limits on wheat for retailers, wholesalers, processors and big-chain retailers till March, 31, 2025. Inflation in wheat in August was 6.61% on year.

Meanwhile, Chopra said the government is mulling lifting the ban on export of certain varieties of non-basmati rice imposed in the last two years.”It is under consideration of the government and these things are dynamic and we will take an appropriate decision depending on the requirements and stock available,” he said. Last week, the government removed the minimum export price of $ 950/tonne on Basmati rice imposed last year.

On the prices of essential commodities, Chopra while in a briefing on 100 days of NDA 3.0 government, Chopra said ,”we have been able to maintain prices at a reasonable level for consumers. the upcoming festival season is looking good. We are not anticipating any kind of spike in prices of essential commodities.”

Tags: stock, Food Corporation of India, grain, rice, wheat, procurement