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That food grain issue
Categories: General, Writings

Riding on a good monsoon and higher support prices for farmers, India managed to produce a record 85 million tonnes (MT) of wheat and 18 MT of pulses for the crop year 2010-2011, which ended in June. The total production of food grains for the same year stands at 241 MT, as against the 218 MT last year. While it might be tempting to revel in these facts and pat each farmer on his/her back for a job well done, there might yet be another side to this story. Like always.

What this bumper crop has meant is that the Government does not really know what to do with it. The storage facilities it has aren’t quite adequate. Government godowns have a bulging wheat stock of 37.8 MT in view of the bumper output. Such is the situation that even Union Agriculture Minister, Mr Sharad Pawar expresses some amount of concern. Talking to the media on the sidelines of an Indian Council of Agricultural Research (ICAR) function, he expressed concern over storage issues that could arise for the new crop to be harvested in 2011-2012. He went on to say that his real worry was for when paddy procurement starts in Andhra Pradesh and Punjab as the current stocks were much more than the country’s requirements.

Perhaps keeping all this in mind, the Government on Saturday decided to lift the four-year old ban on wheat export. During the same interaction with the media, Pawar made as much clear when he said that there was no ban and that wheat exports were allowed. Though the exact amount of grain sanctioned for export has not yet been revealed, or a formal announcement has not yet been made by the Government, this might seem like a prudent move one would say.

Alas, the Russians beat the Indians to it. Although evidence of a global wheat shortage did exist earlier in the year, the Indian Government’s move came only after Russian wheat started flooding the global market. The Russians, also seeing an upward swing in their wheat production, entered the global market after almost one year. Russian Black Sea wheat, which tastes similar to Indian wheat and is of a similar quality, currently trades at $244 per tonne. Traders say Indian wheat would be priced at around $300 per tonne. Clearly, industry insiders aren’t wrong when they say that there is very little possibility that Indian wheat would find takers.

According to those in the know, the best time for India to have entered the market would have been around March-April when there was a real shortage of wheat in the global markets and Russian wheat was yet to arrive. India, however, missed that opportunity. Some believe this delay was because of the pendency of the Food Security Act, which is a favourite of Sonia Gandhi-led National Advisory Council.

So even though the Supreme Court has frequently hauled up the Government for its wasteful practice in a country of hungry people, it looks like grain would again be wasted this year. Sad, don’t you think?

This post first published on SIMC Wire.

  • Aw, look at you…all grown up and writing about politics. :’)

  • Bhavika Aggarwal

    Are you serious? Why can’t they, like, oh my god, feed the hungry?

    On a aside, don’t you need to cite sources for your figures?

    • I’d taken the figures from various newspapers and like. The general practice over at SIMC Wire is not to cite sources for figures in the article, itself. These are generally just sent to the Editor just so that he/she can check the article for authenticity before putting it up.