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Govt orders mandatory declaration of stock position of wheat from today

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An outlook for Indian wheat production presented by BMI, a Fitch Solutions entity, has forecast that India’s wheat production will rise to 110mn tonnes in 2023/24, which will represent an all-time record harvest volume.

In order to manage the overall food security and to prevent hoarding and unscrupulous speculation, the Government has made it mandatory for traders/wholesalers, retailers, big chain retailers and processors in all states and union territories to declare their stock position of wheat on the portal (https://evegoils.nic. in/wheat/login.html) from 1 April, 2024 and then, on every Friday till further orders. All the respective legal entities to ensure that stock are regularly and correctly disclosed on the portal.

Rice stock declaration by all categories of entities is already in-place. Furthermore, with the expiration of the wheat stock limit on March 31, 2024, applicable to all categories of entities in states and UTs, entities are now required to disclose their wheat stock on the portal. The Department of Food and Public Distribution is maintaining a close watch over the stock position of wheat and Rice to control prices and ensure easy availability in the country. Now, all legal entities have to declare their wheat and rice stock on the portal regularly.

The Department of Food and Public Distribution is maintaining a close watch over the stock position of wheat and Rice to control prices and ensure easy availability in the country. An outlook for Indian wheat production presented by BMI, a Fitch Solutions entity, has forecast that India’s wheat production will rise to 110mn tonnes in 2023/24, which will represent an all-time record harvest volume. While India’s wheat crop maintains a minimal exposure to current drought conditions in southern states like Karnataka, above-average rainfall in Uttar Pradesh and other major wheat-producing states through the first two weeks of March 2024 poses downside risk to BMI’s projected harvest volume.

Ahead of the upcoming March-May harvest, the BMI forecast for Indian wheat production in 2023/24 remains below that of the United States Department of Agriculture (USDA), which is 110.6mn tonnes, as well as below that of the Ministry of Agriculture and Farmers Welfare, which is 112mn tonnes. The ministry’s final report on planted acreage, published at the start of February 2024, indicated a wheat coverage area more or less unchanged (+0.7% y-o-y) from the 2022/23 season.

After an estimated 1.1 per cent y-o-y decline in 2022/23, the research shows that domestic wheat consumption in India will grow by 2.5 per cent y-o-y in 2023/24 and, therefore, climb to 111.4mn tonnes. As a result, the report points out that the generation of a third consecutive wheat production deficit during the season, although somewhat narrower than the 4.7mn-tonne shortfall that resulted from the 2022/23 season.

As per USDA estimates, end-of-season wheat stocks in India fell to 9.5mn tonnes in 2022/23, their lowest level since 2007/08. Given minimum stock level requirements, India could therefore be required to import wheat in 2024, especially if crop yields fall below expectations. At present, the Ministry of Agriculture and Farmers Welfare forecasts an average wheat yield of 3.52 tonnes per hectare, in line with that achieved in 2022/23, the BMI report projects.

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Economic

India’s food processing sector set to surge, eyes USD 535 billion by 2025-26

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Anita Praveen, the Secretary of the Ministry of Food Processing, emphasized the pivotal role of research and development (R&D) in propelling India’s food processing sector to greater heights. Speaking at the FICCI Scientific Symposium on ‘Processed Foods for Purpose,’ Praveen highlighted the sector’s significant potential for growth and its status as a priority area within India’s agricultural landscape.

Praveen stated, “The Indian agriculture sector is witnessing robust growth with record levels of production, and the Food Processing sector has become one of the priority sectors for growth.” She added, “We have already reached high levels of growth with the resources we have. There is a need now for the food processing sector with R&D as a focus for taking the sector to the next level.”

She underscored the pivotal role of the food processing sector in driving economic growth and generating employment opportunities, particularly for micro and small enterprises. “Food processing sector is one of the large investment generators, particularly for the micro and small sector, and has the potential to bring more private investments,” said Praveen. “With the resources at our disposal, we have achieved substantial growth. Now, the focus must shift towards leveraging R&D to propel the sector to new heights,” she remarked.

The Secretary outlined the strategic advantages of the food processing industry, citing abundant availability of raw materials at competitive prices and burgeoning consumer demand both domestically and internationally. “This sector has advantages of high raw materials availability at cheaper prices, high consumer demands both in domestic and international markets. This is the time to give a push to the food processing industry,” Praveen said.

Praveen also addressed the pressing issue of food wastage, emphasizing the need for comprehensive waste management strategies at every stage, from farm to fork. She stressed the importance of direct engagement between industry players, farmers, and micro-level processing units to enhance efficiency and minimize wastage.

“The time is right to bring these micro units and link them with large industries. The downward linkage approach will be advantageous for large industries to control quality, maintain standards, and have a sustained supply chain,” she added. “The industry should focus on educating the consumer, and we must adopt a balanced approach to this educational initiative. Consumers must know what they are consuming, and quality food production is the responsibility of the industry,” she added.

To boost exports, Praveen advocated for closer collaboration between large industries and smaller units, emphasizing the importance of quality control and maintaining robust supply chains. She highlighted the industry’s responsibility in consumer education, advocating for transparency and a balanced approach to fostering awareness about food quality and safety.

Siraj Hussain, Advisor to the FICCI Food Processing Committee and Former Secretary of the Ministry of Food Processing Industries, echoed Praveen’s sentiments, emphasizing the critical role of food processing in ensuring food safety and nutrition. “Food processing serves as a critical link between farm and fork. It acts as a catalyst for economic growth, generating employment opportunities and driving innovation across the food sector. The role of food processing in providing safe, healthy, and nutritious food has now taken center stage,” Hussain said. He underscored the sector’s potential as a driver of economic growth and innovation.

Sanjay Khajuria, president of CIFTI-FICCI and director, Corporate Affairs at Nestle India Ltd, hailed food processing as a ‘sunrise sector,’ lauding its progress in modernization and sustainable economic growth. “Food Processing sector is considered a sunrise sector and has achieved notable progress in terms of modernization and sustainable economic growth in recent years,” he said.

Dr. Seema Bathla, professor at the Centre for the Study of Regional Development, Jawaharlal Nehru University, highlighted the four key elements of the Indian agriculture food system: production, consumption, ecology, and environment. “The Indian agriculture food system has four key elements which include production, consumption, ecology, and environment,” she said.

With projections indicating an upward trend, India’s food processing sector’s output is expected to soar more than USD 600 billion by the fiscal year 2025-26.

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Agriculture

India set to halt urea imports by end of 2025, says Mansukh Mandaviya

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Minister Mandaviya underscores India’s shift towards promoting alternative fertilisers for enhanced crop and soil health, alongside ensuring fertiliser availability in agriculture.

In a significant move towards bolstering domestic manufacturing and agricultural self-reliance, India is poised to halt urea imports by the end of 2025. Chemicals and Fertilisers Minister Mansukh Mandaviya announced this milestone, attributing it to a concerted push for domestic production, which has effectively bridged the gap between supply and demand.

Highlighting the pivotal role of fertilisers in Indian agriculture, Minister Mandaviya emphasized the government’s commitment to ensuring their availability. He noted that India has relied on chemical fertilisers for over six decades to augment crop production. However, in recent years, there has been a concerted effort to promote alternative fertilisers such as nano liquid urea and nano liquid di-ammonium phosphate (DAP), citing their benefits for crop and soil health.

Addressing concerns regarding achieving urea self-sufficiency, Mandaviya outlined the government’s dual strategy of reviving closed urea plants and expanding production capacities. He noted a substantial increase in domestic production capacities from 22.5 million tonnes in 2014-15 to around 31 million tonnes presently. Despite this progress, there remains a shortfall of approximately 4 million tonnes annually.

To address this gap, Mandaviya revealed plans to commission additional production facilities, aiming to reach an annual capacity of around 32.5 million tonnes. Moreover, the government aims to substitute 2-2.5 million tonnes of conventional urea with nano liquid urea, further bolstering domestic production.

The Minister expressed confidence in achieving the target by the end of 2025, effectively eliminating the need for urea imports and reducing the import bill to zero. Import figures have already shown a declining trend, dropping from 9.136 million tonnes in 2021-22 to 7.58 million tonnes in 2022-23.

Over the past decade, the government has prioritized ensuring an adequate supply of fertilisers while shielding farmers from volatile global prices through increased subsidies. Notably, the fertiliser subsidy for the fiscal year 2024-25 stands at Rs 1.64 trillion, demonstrating the government’s commitment to supporting agricultural productivity.

The transition to alternative fertilisers has gained momentum, with nano liquid urea witnessing increased demand. Cooperative organization IFFCO’s initiative in launching nano urea has been instrumental in this shift, with 70 million bottles sold between August 2021 and February 2024. Additionally, schemes like ‘PM Programme for Restoration, Awareness, Nourishment and Amelioration of Mother Earth’ (PM-PRANAM) incentivize the adoption of alternative fertilisers and balanced usage of chemical fertilisers.

Underpinning these efforts are subsidy schemes like the Urea Subsidy Scheme (USS) and the Nutrient Based Subsidy Policy, ensuring affordability and accessibility of fertilisers for farmers. While urea imports are managed by the government, other fertilisers are imported under commercially viable terms.

With these strategic initiatives, India is on course to achieve urea self-sufficiency by 2025, marking a significant milestone in its agricultural journey towards self-reliance and sustainability.

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Agriculture

Right practices can boost average mustard yields by 35 per cent: SEA Study

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The average mustard yield can jump by 35 per cent over five years even with the currently available seeds if the ideal agronomic practices are adopted, a study conducted by the Solvent Extractors Association of India (SEA) has found, amid a raging debate over the yield potential of genetically modified mustard against the existing varieties. SEA, the premier association of domestic oilseed extractors, conducted the pilot project in association with Solidaridad Network, an international civil society organisation working to facilitate the development of socially responsible, ecologically sound and profitable supply chains. Started in 2020-21 with 400 farms in five districts of Rajasthan, the project was gradually scaled up to cover other major mustard-producing states. It was conducted in around 3,500 model farms spread across five states involving more than 125,000 farmers.

The study found a 35 per cent increase in the average yield of mustard over five years from 1,787 kilogrammes to 2,414.8 kilogrammes in the model farms as compared to the regular ones. “The mustard model farms had implemented various strategies to achieve this target focusing primarily on enhancing mustard yields through innovative farming practices, advanced technological adoption and comprehensive farmer support programmes,” SEA said in a statement. “The yield increases were realised using the currently available seeds and no genetically modified (GM) seed was used in the process,” BV Mehta, executive director of SEA, told Business Standard. Apart from techno-economic inputs under the project; farmers were also trained through unique Farmers Field Schools (FFS) at the block level.

“These FFS acted as strong community institutions where farmers shared their learnings,” the statement said. The SEA analysis showed that mustard is an ideal crop for low monsoon and less irrigated areas as it offers higher returns with a low cost of production and less water. A growth in mustard seed yield could also contribute to reducing India’s import dependency on edible oils. Currently, India imports around 60 per cent of its annual edible oil requirements. According to the SEA, in 2022-23 (November to October) India imported around 16.47 million tonnes of edible oils valued at around Rs 138,000 crore. “It amplifies the need for self-sufficiency in edible oil production to mitigate the impact,” SEA said.

India’s mustard seed production has grown from 8.6 million tonnes in 2020-21 to 11.35 million tonnes in 2022-23 while the area under the crop has risen from 6.70 million hectares in 2020- 21 to 8.80 million hectares in 2022-23. “The production of mustard seed is projected to reach an all-time high of 12 million tonnes in the current 2023-24 (Nov-Oct) season with sowing area at a record 10 million hectares,” the SEA said.

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Economic

Kalanamak rice exports get boost as Govt waives duty on 1,000 tonnes

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The removal of the hefty 20% duty on overseas exports marks a significant shift in the government’s trade policy regarding Kalanamak rice.

In a significant move aimed at promoting trade of agricultural commodities, the government has lifted the duty on exports of the Kalanamak variety of rice. This exemption applies to shipments of up to 1,000 tonnes and is effective immediately from Wednesday, according to a notification issued by the Finance Ministry.

Previously subject to a hefty 20% duty on overseas exports, the removal of this tariff barrier marks a notable shift in the government’s trade policy concerning Kalanamak rice. The Directorate General of Foreign Trade (DGFT) paved the way for this initiative on Tuesday by authorizing exports of up to 1,000 tonnes of Kalanamak rice through six specified customs stations.

Kalanamak rice, a type of non-basmati rice renowned for its distinct aroma and taste, was previously prohibited for export. However, with this recent decision, it joins the ranks of exportable agricultural commodities, offering new avenues for Indian rice producers to tap into international markets.

Exporters can now utilize six designated customs stations for shipping Kalanamak rice abroad. These include Varanasi Air Cargo, JNCH (Jawaharlal Nehru Customs House) in Maharashtra, CH (Customs House) Kandla in Gujarat, LCS (Land Customs Station) Nepalgunj Road, LCS Sonauli, and LCS Barhni.

The government’s move to facilitate the export of Kalanamak rice underscores its commitment to boosting agricultural exports and diversifying the country’s trade portfolio. This decision is likely to open up new opportunities for farmers and exporters, while also enhancing India’s presence in the global rice market.

This strategic decision by the government comes amidst efforts to bolster India’s agricultural sector and enhance its competitiveness in the global market. Kalanamak rice, with its unique characteristics and cultural significance, holds immense potential for export growth. By lifting the duty on its overseas shipments, the government aims to capitalize on this potential and support the livelihoods of farmers involved in its cultivation.

Furthermore, the exemption of duty on Kalanamak rice exports aligns with the broader agenda of promoting agricultural trade and achieving the goals outlined in various government initiatives such as the Agricultural Export Policy and Atmanirbhar Bharat Abhiyan (Self-Reliant India Mission). Encouraging exports of agricultural products not only contributes to economic growth but also fosters rural development and empowers farmers by providing them access to international markets.

As India strives to become a global powerhouse in agriculture, initiatives like these play a crucial role in strengthening the country’s position as a reliable supplier of high-quality agricultural commodities. Moreover, by tapping into niche markets with unique products like Kalanamak rice, India can carve out a niche for itself and establish a reputation for excellence in agricultural exports.

In conclusion, the removal of duty on Kalanamak rice exports signifies a significant step towards realizing the full export potential of India’s agricultural produce. It reflects the government’s commitment to fostering a conducive environment for agricultural trade and underscores its resolve to empower farmers and bolster rural economies. This move is poised to not only boost India’s export earnings but also enhance its stature as a key player in the global agricultural arena.

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Agriculture

Malaysia seeks additional 500,000 tons of rice from India

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Malaysia is set to make a formal request to India for the procurement of an additional 500,000 metric tons of white rice, as confirmed by the country’s Agriculture Minister. This move comes in addition to the 170,000 tons of white rice that India had previously allocated to Malaysia for the year. India, being the world’s largest rice exporter, had imposed restrictions on rice shipments to address inflation concerns and ensure food security. According to Bernas, a state-run rice importer, Malaysia’s annual rice consumption stands at 2.5 million metric tons, with an average imported supply of 750,000 tons.

The Agriculture Minister, Mohamad Sabu, announced the forthcoming official request to India through diplomatic channels following a meeting with India’s Foreign Minister Subrahmanyam Jaishankar. Furthermore, Mohamad revealed that Malaysia had earlier submitted a request to India in January for 100,000 metric tons of onions through a government-to-government arrangement. This indicates Malaysia’s efforts to secure essential food supplies from India amidst its domestic consumption requirements.

The request for additional white rice from India underscores Malaysia’s reliance on imports to meet its rice demand and the importance of securing stable and sufficient food supplies for its population. As the two countries navigate their bilateral trade relations, the outcome of Malaysia’s request to India will significantly impact Malaysia’s food security and rice market dynamics. India’s decision on Malaysia’s request for additional white rice will be closely watched, particularly given India’s strategic position as a major rice exporter in the global market.

Malaysia’s reliance on imported rice highlights the significance of stable trade relations between the two countries in ensuring food security and meeting domestic demand. Furthermore, Malaysia’s request for onions earlier this year underscores the country’s efforts to diversify its sources of essential food items. The government-to-government arrangement reflects Malaysia’s proactive approach in securing critical commodities to address potential supply chain disruptions and price volatility.

Malaysia’s formal request to India for additional white rice underscores the importance of international cooperation in addressing food security challenges. The outcome of this request will not only impact Malaysia’s agricultural sector and consumer market but also highlight the broader implications of trade dynamics in the global food supply chain. As Malaysia awaits India’s response to its request for additional white rice, the outcome will carry significant implications for both nations’ agricultural sectors and trade relations. Malaysia’s proactive steps to secure essential food supplies underscore the importance of bilateral cooperation in addressing food security challenges amid global uncertainties.

The successful fulfilment of Malaysia’s request would not only alleviate immediate food supply concerns but also strengthen the foundation for future trade collaborations between the two countries. Conversely, any delays or restrictions in fulfilling the request could potentially strain bilateral relations and disrupt Malaysia’s efforts to meet its domestic consumption requirements. Additionally, the outcome of Malaysia’s request will reverberate across the wider region, as both countries play crucial roles in shaping rice market dynamics and food trade patterns. As such, a mutually beneficial resolution to the request would contribute to stability and resilience in the regional food supply chain.

In the context of evolving geopolitical dynamics and economic uncertainties, Malaysia’s pursuit of additional white rice underscores the imperative of fostering robust and dependable trade partnerships. By working collaboratively to address food security challenges, India and Malaysia can forge stronger ties and contribute to the collective well-being of their populations. In conclusion, the formal request from Malaysia to India for additional white rice highlights the inter-connectedness of global food systems and the importance of international cooperation in ensuring food security for all.

The successful resolution of this request would not only bolster Malaysia’s food security but also underscore the significance of fostering resilient trade relationships in an increasingly interdependent world.

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Economic

CCI procures over 32 lakh cotton bales at MSP in 2023-24 season

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The Cotton Corporation of India (CCI) reported its procurement of 32.81 lakh bales of cotton during the ongoing 2023-24 season, primarily sourced from Telangana, Andhra Pradesh, Maharashtra, and Gujarat. Acting as the government’s primary agency for cotton procurement at minimum support prices (MSP), the CCI initiates purchases when market prices dip below MSP levels. The procurement season spans from October 2023 to September 2024.

According to a senior CCI official, procurement was initiated this year due to declining prices starting from mid-October 2023. The official highlighted that approximately 32.81 lakh bales, each weighing 170 kg, have been acquired at MSP thus far in the current season. Notably, the CCI has already sold off 3.37 lakh bales of the procured cotton.

The government has set the MSP for medium staple cotton at Rs 6620 per quintal and for long-staple cotton at Rs 7,020 per quintal for the 2023-24 season.

Despite the procurement drive, the official noted that cotton prices in the open market have risen above MSP levels since March-end. Consequently, it is anticipated that farmers may refrain from selling their produce to the CCI. However, the CCI remains prepared for procurement if market rates dip below the support price again.

Cotton production estimates for the 2023-24 season stand at 323.11 lakh bales, a decrease from the 336.6 lakh bales recorded in the previous season, as per estimates by the agriculture ministry.

In summary, the Cotton Corporation of India (CCI) has procured a substantial amount of cotton during the 2023-24 season to support farmers and stabilize prices. Despite challenges posed by fluctuating market conditions, the CCI has efficiently managed the procurement process, ensuring that farmers receive fair prices for their produce. With cotton prices in the open market currently above the MSP levels, the CCI remains vigilant and prepared to respond to any future fluctuations that may occur. As the cotton season progresses, the CCI’s role in maintaining stability in the cotton market will continue to be crucial for the welfare of cotton farmers across India.

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