Wheat stocks decline to 7-year low on poor procurement, shows data

Wheat stocks in the central pool fell to a seven-year low of 9.7 million tonnes due to below par procurement for two consecutive seasons. Stocks as on March 1, 2023, stood at around 11.67 million tonnes.

Wheat stocks as on April 1 of each year should be around 7.5 million tonnes, according to the buffer and strategic reserve norms.

The last time wheat stocks were below the current levels on March 1 was back in 2017. It had then dropped to 9.42 million tonnes.

However, the good news is that stocks may swell again as the forthcoming wheat crop is projected to be at a record of over 114 million tonnes.

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In the rabi marketing season of 2019-20 (April to March) to 2021-22, wheat procurement saw an increasing trend and reached a record 43.3 million tonnes in 2021-22.

But procurement saw a steep decline in the rabi marketing season of 2022-23, touching a record low of 18.8 million tonnes. However, it increased by about 40 per cent to 26.2 million tonnes in 2023-24.

In both the 2022-23 and 2023-24 marketing seasons, procurement was less than the targeted amount as market prices were higher than the minimum support price (MSP). This is why farmers preferred private buyers than government agencies.

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In June 2023, the government began selling wheat to private players, and by the end of last month, it had sold more than 9 million tonnes of wheat. This is a record high, Reuters reported, quoting an unnamed senior government official.

In 2022, India banned wheat exports after a surge in temperatures lowered output. This came even as export demand rose as the Russia-Ukraine conflict led to a global shortfall.