Govt’s paddy procurement crosses 30 MT in two months

By Sandip Das

Two months into paddy procurement for the kharif season 2023-24, the Food Corporation of India (FCI) and state agencies have purchased nearly 30 million tonnes (MT) under the minimum support price (MSP) operations, marking a 6% decline compared to the previous year.

According to the food ministry, 32.66 MT of paddy has arrived in the mandis across key rice producing states. The officials said kharif paddy purchase target of 77.4 MT this season will be met and attributed the decline to delayed harvesting in states like Punjab, Chhattisgarh, and Telangana, caused by replanting due to floods in July and assembly elections.

Major contributors to paddy procurement include Punjab (18.42 MT), Haryana (5.87 MT), Telangana (1.97 MT), Chhattisgarh (1.28 MT), Uttar Pradesh (0.77 MT), Uttarakhand (0.57 MT), and Tamil Nadu (0.54 MT).

Rice procurement is ongoing in several other states, including West Bengal, Bihar, and Andhra Pradesh. Purchase operations in Odisha, a significant contributor to central pool stocks, are expected to commence soon.This year’s grain procurement is closely monitored due to uneven monsoon rainfall which may may impact the rice output in 2023-24 crop year (July-June) despite higher area under paddy cultivation.

In August, FCI and state agencies set a 52.1 MT rice (77.4 MT paddy) purchase target for the kharif season, compared to 49.5 MT procured in the previous season.During the 2022-23 season, FCI and state agencies procured over 56.94 MT of rice in both kharif and rabi seasons. Kharif rice production in India is estimated at 106.31 MT, a 3.7% decline due to uneven monsoon distribution.

Currently, FCI holds 18.56 MT of rice stocks, excluding 25 MT receivable from millers. The rice stock is against the buffer of 7.61 MT for January 1.FCI annually supplies 38 MT of rice for supply to the beneficiaries under the National Food Security Act (NFSA) renamed as Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY).

States including Punjab, Haryana, Chhattisgarh, Odisha, Telangana and Andhra Pradesh contribute significantly to the central rice pool which is used for supplying grain to PMGKAY beneficiaries. The rice procured from grain surplus states is also used for keeping a buffer stock with FCI.The government has increased the MSP of the common variety of paddy by more than 7% to Rs 2,183/quintal for 2022-23 season compared to the previous season.

After paddy is procured from the farmers by FCI and state agencies, it is handed over to millers for conversion into rice. Paddy to rice conversion ratio is 67%.

This article has been republished from The Financial Express

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