UP flour mills struggle to keep the show going

Deregulation of wheat the main reason for crisis

Roller flour mills, producing wheat products like atta, maida and suji are struggling for survival, since wheat has vanished from the markets in Uttar Pradesh.

Many mills have closed down while others were running at less then 50 per cent of their total capacity utilisation. The total annual installed capacity of Uttar Pradesh was 40 lakh million tonne at one time.

Deregulation of the wheat trading has also contributed to the present wheat crisis in UP, since till date there were no restriction on the inter state movement of goods or any limits on storage by the traders. MNCs can now procure wheat directly from farmers at the minimum support price fixed by the government.

The UP Roller Flour Millers Association has written to the state government and the Food Corporation of India to immediately increase the availability of the wheat in open markets.

"While the market price of wheat is soaring, it's availability is decreasing," VVS Chauhan, the association's secretary said. A shortfall of 25 per cent in wheat production, coupled with a low allotment of wheat for release in the open market by FCI has aggravated the situation in UP, Chauhan added.

Against a target of 250 lakh million tonnes in the Rabi season of 2004-05, the actual production was less then 200 lakh million tonnes in UP.

Criticising the Centre for the present situation, Chauhan said monthly allotment for open market in UP was far lower then many smaller states.

"Even for a 50 per cent capacity utilisation, UP flour mills need as much as 2 lakh million tonnes of wheat each month. However, the allotment in January last year was only 8,000 million tonnes," Chauhan said, adding, "Though 8,000 million tonne was allotted for the month of February, it was later reduced to 5,000 million tonnes, with the remaining 3,000 million tonnes allotted to Uttaranchal by the food ministry.

The figures of the FCI sustain the contention of UP flour mills. Under the "open market sales scheme-domestic (OMSS-D) the FCI released 25,000 million tonnes for West Bengal, 35,000 for Delhi and, Karnataka, 25,000 for Maharashtra and Tamilnadu and 8,000 for UP. The allotment situation remained the same for the current month February.

The UP flour Millers Association has written to the chief minister to prevail upon FCI to release at least 50, 000 million tonnes in UP, under OMSS-D, for the months of February and March.

It has also urged the state government to divert the 2.7 lakh monthly allotment of wheat for the above poverty line (APL) for the open market since the off take from the PDS shops remained nil in UP.

The association pointed out in West Bengal, against the monthly allotment of 1 lakh million tonne for the APL, the off take was over 70,000 million tonnes.