Wheat procurement in Amritsar dips 6%

Although there has been more wheat production in Amritsar district this year, as compared to last year, despite a decline in the area under cultivation, the procurement by government agencies has gone down by 6 per cent, compared to last year.

As a result, a majority of the farmers are holding their stocks, hoping that shortly the price will increase significantly, while some of them have sold their produce to private agencies, which are offering better prices than their government counterparts.

The district stood second in the production of wheat, with 1.649 million tonnes, after Sangrur, which produced 1.677 million tonnes. Wheat production in Punjab this year has been about 14.493 million tonnes.

Moreover, last year the area under wheat cultivation was 372,000 hectares, while this year it declined to 371,000 hectares in the Amritsar district. Sources say the diversification of crops is the key factor in bringing down the area under cultivation.

This year, the government agencies managed to procure only 963,000 tonnes of wheat from the district till date, which is about 6 per cent less than the previous year's 1.023 million tonnes.

Similarly, last year, the government agencies procured about 9.1 million tonnes of wheat in the state while this year it managed to procure only about 7 million tonnes.

Sources in the department of agriculture say private players have entered the Punjab market in a substantial way this year. They are offering anything between Re 1 and Rs 20 per quintal more than the minimum support price (MSP) of Rs 650.

When the procurement season began on April 1, the private traders were paying farmers between Rs 700 and Rs 800 per quintal. A private company called NCDX has offered farmers in Khanna Rs 900 per quintal, if the farmers pledged their produce with them for sale in November. It is alleged that many private traders, millers, commission agents, and even farmers are now stocking their produce.

This is a reason why smaller quantities are arriving in the mandis. Other reasons are the low MSP, and low profits offered by the government agencies.