India. Govt wheat inventory at High

The government had 33.1 mln tn of wheat in its central pool as of Nov 1, up from 23.9 mln tn in the year-ago period, according to data released by Food Corp of India.

The nearly 10-mln-tn rise in stocks is primarily because of robust procurement this year.

In the season started April, the government procured 35.8 mln tn of wheat, around 16% higher on year.

The sharp rise in procurement this year can be attributed to a higher minimum support price. For the 2018-19 marketing season (Apr-Mar), the government fixed the support price for wheat at 1,735 rupees per 100 kg, up from 1,625 rupees last year.

Procurement was higher in all producing states, especially in Punjab, Haryana, Uttar Pradesh, and Madhya Pradesh.

The rise in procurement can also be attributed to higher wheat production in 2017-18 (Jul-Jun).

According to the farm ministry’s fourth advance estimates, Indian farmers likely harvested a record 99.7 mln tn of wheat in 2017-18.

The government has set a wheat output target of 100.0 mln tn for 2018-19. For the 2019-20 marketing season, the government has announced a support price of 1,840 rupees per 100 kg for wheat.

According to buffer stock norms, as of Oct 1, the government must have 25.8 mln tn of food grain under operational stock with 3.0 mln tn wheat for strategic reserves.

On Oct 1, the government had 54.3 mln tn of food grain stocks in its reserves.

Food Corp of India started weekly auctions under the open market sales scheme from July to trim excess stocks, a senior official from the agency said. Since then, 2.38 mln tn wheat has been sold under the scheme.

Besides wheat, the government had 16.3 mln tn rice in its stock as of Nov 1, against 14.0 mln tn a year ago, and 18.6 mln tn as on Oct 1.

At the beginning of November, total food grain inventory with the government was at 49.4 mln tn, up from 37.9 mln tn a year ago. Last month, total food grain inventory in the central pool was at 54.3 mln tn.