Despite the claim of record production, the imposition of storage limit on wheat is surprising

26-Jun-2024 03:14 PM

New Delhi. In the third advance estimate of the Union Agriculture Ministry, the domestic production of wheat is expected to increase to an all-time high of 1129 lakh tonnes in the Rabi season of 2023-24 and its government procurement has also increased by 3-4 lakh tonnes to 265-266 lakh tonnes, but still the government had to decide to impose storage limit on wheat,

which is being considered a surprising step. It is also worth noting that for the last two years, there is a ban on commercial export of wheat and its products from the country. Last year, the government had estimated domestic production of 1105.50 lakh tonnes of wheat.

On June 24, the government imposed storage limit on wheat with immediate effect, which will remain in force till March 31, 2025.

A certain amount of wheat stock should be available for different categories in a given period. This rule is likely to affect such big farmers who are holding back wheat stocks in the hope of getting higher prices in future because millers and traders would not like to buy more than the quantity fixed by the government. Traders-stockists who have wheat stocks in excess of this fixed quantity will have to ensure the sale of this extra quantity as soon as possible.

There is always an atmosphere of uncertainty in the industry-trade sector due to the government's policies changing from time to time. India's credibility in the global export market is decreasing rapidly and government policies are also having an adverse effect on the domestic market.

To control food inflation, the government should implement a liberal import policy. The decision to impose storage limits or stop exports is not considered practical.