MP, Rajasthan declare bonus for wheat farmers

Madhya Pradesh, the second biggest contributor to the central pool wheat stock after Punjab, is aiming to procure a 8.2 million tonne (MT) of grain in the 2024-25 rabi marketing season (April-June),which is expected to bolster the government’s wheat stock which has plummeted to lowest level since 2016.

Smita Bharadwaj, additional chief secretary, food, civil supplies and consumer affairs, Madhya Pradesh told FE that more than 1.5 million farmers have registered for procurement operations which have just commenced which is likely to pick up pace in the next few weeks.

“We have allowed the farmers to register for the wheat procurement till the end of current month as announcement of bonus over minimum support price (MSP) was done recently,” Bharadwaj said. Recently, Madhya Pradesh and Rajasthan have approved payment of Rs 125/quintal bonus over the MSP of Rs 2275/quintal of wheat to be paid to farmers.

In the previous marketing season (2023-24), Madhya Pradesh contributed 7.09 MT of wheat to the total procurement drive. Overall purchase in the central Indian state could surpass the target following the announcement of bonus.

Till Tuesday, the Food Corporation of India (FCI) had a wheat stock of 8.02 MT, which is lowest since 2016. The stock is precariously close to the buffer of 7.46 MT for April 1.

Although officially the procurement of wheat for rabi marketing season commences from April 1, the state agencies and FCI has commenced purchase of wheat from the farmers under the Minimum Support Price (MSP) operations in Madhya Pradesh and Rajasthan. So far, 983 tonne of wheat has been purchased from the farmers in these two states.

The grain procurement target for the 2025-26 marketing season is around 30 – 32 MT against 26.2 MT purchased from the farmers under MSP operations last season.

Punjab and Haryana will start MSP purchase operation from April 1. Uttar Pradesh has already announced procurement of wheat from farmers at MSP.

Punjab is aiming to purchase 13 MT of wheat in the new rabi marketing season.

The agriculture ministry in ites second advance estimate of foodgrain productions for 2023-24 crop year (July-June) has estimated wheat outputat 112 MT, which is marginally higher from the previous crop year.

FCI annually requires around 18 MT of wheat annually for distribution of grain under the free ration scheme – Pradhan Mantri Garib Kalyana Anna Yojana. “We need sufficient stock to carry out open market sale of grain to the bulk buyers next year,” an official said.

Inflation in wheat declined further to only 2% in February from 12% in July,2023 on year because of improvement in supplies due to open market sale being carried out by the FCI.

The government from this month stopped open market sale of wheat which was carried out since June last year through weekly e-auction with a record ever sales of 9.4 MT to bulk buyers.