Wheat storage cost in Punjab likely to increase by Rs 100 crore

19-Jun-2025 04:22 PM

Chandigarh. The Food Corporation of India (FCI) is facing a potential increase of around Rs 100 crore in wheat storage costs in Punjab, largely due to a shift in commission payments for storage in steel silos.

The FCI is reportedly spending an additional Rs 100 per quintal to store wheat in these silos, which have a total storage capacity of 9.85 lakh tonnes in the state.

This spike in cost is primarily the result of FCI’s decision to slash the commission (Dami) paid to commission agents for wheat stored in silos—from Rs 46 per quintal to Rs 23 per quintal.

These silos are built to maintain wheat in a vacuum-like environment, ensuring safe storage for up to five years. They are a key part of FCI’s modern grain management system.

However, the 50 percent reduction in commission is drawing sharp criticism from commission agents and farmers’ organisations, who argue that this cut undermines incentives to deliver wheat directly to silos. According to a senior official in the Punjab Food Department, the logistical implications are significant.

Wheat will now have to be packed in gunny bags and transported to silos, which will add transportation costs of around Rs 100 per quintal.

The FCI maintains that once wheat is stored in the silos, the role of commission agents diminishes, justifying the reduction in their commission.

On the other hand, agents argue that collecting wheat from the open market and delivering it to silos involves a complex and labour-intensive process, and therefore, the commission should remain unchanged.

The ongoing standoff has raised concerns about both rising costs and operational disruptions in wheat procurement and storage across Punjab.