FCI may procure over 13 mt wheat

Wheat procurement for 2006-07 rabi season is going to start in about two weeks. Ajay Modi talks to Alok Sinha, chairman and managing director, Food Corporation of India (FCI), government's primary grain procurement agency, on this year's procurement plans.

What quantities of wheat are you hopeful of procuring?

Our internal calculations together with feedback from states indicate the procurement may cross 13 million tonne. Punjab is likely to contribute 10 million tonne while Haryana may add another 3 million tonne. The rest will come from Uttar Pradesh.

Last year, FCI managed to procure only 9.23 million tonne wheat against 14.79 tonne the year before. What makes you think this year's procurement will be better?

First, the farm output estimated to be higher by 3.5-4 million tonne at 73-74 million tonne compared with last year's production.

Secondly, our buffer stock will be 4.5 million tonne against 2.09 million tonne, when we start procurement. This will give a positive signal for procurement. Besides, the higher minimum support price (Rs 750 a quintal as against Rs 650 last year) will allow us to procure more.

Last year private companies procured sizeable wheat from mandis. Do you see any competition from them this time?

I personally see no competition from private trading firms. Wheat arrivals this year will be adequate to allow procurement by both the parties.

Is the minimum support price (MSP) of Rs 750 a quintal good enough for farmers? Should there be a bonus?

It is too early to say if the current (MSP) will give us better procurement than that of last year. Maybe, a timely announcement of bonus can complement the higher MSP.

Has all the preparations been made to start procurement?

Yes. We have bought 300 crore gunny bags with a capacity of 50 kg each. This will be sufficient to pack 15 million tonne wheat.

What has been done to minimise the storage losses?

We have installed electronic weighbridge at all major godowns to cut down losses. Our storage losses have come down from .80 per cent to .29 per cent over the last ten years. We are also taking disciplinary action against employees responsible for such losses.