FCI foodgrains stock down by 37% from last year; yet higher than buffer

Centre's foodgrains stock managed by the Food Corporation of India remains 66% higher than the buffer norm

Rice and wheat stocks in the central pool, managed by the Food Corporation of India (FCI), down by 37 per cent in comparison with last year, reported Thehindubusinessline. However, the FCI data shows that the foodgrain stock continues to be 66 per cent higher than the buffer norm. While the strategic reserve and buffer norm mandate maintaining a foodgrain stock of 30.55 million tonnes (mt), the current stock is 51.14 mt. 

Lower procurement of wheat and the continuation of the free foodgrain scheme Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) have driven the depletion of the stocks to the lowest in the last five years. 

The latest FCI data show that currently, India has 22.75 mt of wheat, 20.47 mt of rice and 11.83 mt of unmilled paddy in the reserve. Last year, the stock was wheat 46.85 mt, rice 25.33 mt and unmilled paddy 14.07 mt.

The last low of the rice and wheat stocks together was 43.34 mt, reported on October 1, 2017. 

The foodgrains requirement under the National Food Security Act (NFSA), other welfare programmes, and additional requirements under the PMGKAY have all been met by the government, according to information released by the Food Ministry earlier this month. Prices have also been kept under control, the ministry added.

The union cabinet authorised the extension of PMGKAY on September 28 for a further three months, from October to December, at an additional cost of Rs 44,762 crore, allowing over 80 crore NFSA recipients to get more foodgrains at no additional cost over their usual entitlement under the law. Around 12.2 million tonnes of foodgrains will be needed to run it for the three months.

Following the extension of PMGKAY, the closing stockpiles with FCI for the current fiscal year (on March 31) will continue to be more than the buffer norms at around 11 mt of wheat and 22.5 mt of rice. As of April 1, the buffer norms, which include strategic reserves, prescribe 7.46 mt of wheat and 13.58 mt of rice.

Previously, the government had claimed that it had not yet used the open market sale system (OMSS) to intervene in the foodgrain market. However, it sold 8 mt of foodgrains through the programme in 2021–2022 by providing rice and wheat at a noticeably cheaper cost.

Even though flour millers have been requesting that some quantity of wheat be released, the government has not allocated any grain under OMSS this year due to decreased inventories.