Govt wheat stocks rise over the triple buffer to 36 MT, at five years high
By Sandip Das
The government is staring at hugely surplus wheat stocks after a five-year, just one month of commencement of procurement of grain for the 2026-27 marketing season (April-June) from farmers.
Sources said that as on May 1, the central pool has wheat stocks of around 36 million tonne (MT), over three times the buffer of 7.46 MT for April 1. The stock exceeded the buffer requirement of 27.58 MT on July 1. The current stock with the government agencies, is highest since May 1, 2021. Higher procurement and the sluggish sales of wheat under the Food Corporation of India’s (FCI) open market sale scheme in FY26 have also contributed to higher stocks.
Sources said with another 8 to 10 MT procurement of grain by the agencies is projected in the current marketing season, stocks are likely to swell further in coming weeks. This against the annual requirement of 18-20 MT of wheat being annually supplied under the Pradhan Mantri Garib Kalyan Anna Yojana or free ration scheme.
Trade sources said that the challenge for the government to dispose of wheat at the earliest as a chunk of over 23 MT of wheat purchased in April from farmers, was under the relaxed quality norms. Due to unseasonal rains impacting grain quality, the food ministry had allowed procurement of grain upto 70% lustre loss and increased shriveled or broken grain limit to 15% from the existing limit of 6%.
Quality Norms
The ministry has directed the procuring agencies to liquidate the wheat procured under the relaxed norms on a priority basis. The government agencies have set a target of over 34 MT of wheat purchase for the season.
Industry sources said that private entities are cautiously procuring wheat around Rs 2600 to Rs 2650 per quintal which is at par with prices prevailing a year ago. Current prices are against the minimum support price of 2,585/quintal for the current marketing season.
“Decision-making remains uncertain due to the government’s substantial wheat stockpiles. Consequently, the industry is adopting a wait-and-watch approach, pending the government’s announcement of this year’s wheat policy (in terms of open market sale),” Navneet Chitlangia, President, Roller Flour Millers’ Federation of India, told FE.
The all India average retail prices of wheat according to the department of consumer affairs on Saturday was Rs 30.88/kg, a decline of 1.56% on year.
Export Pivot
Against an allocation of 3 MT, FCI would offload only about 0.6 MT in the market under the open market sale in 2025-26. In FY25, the corporation sold 3 MT of wheat in the markets from its surplus stock.
After lifting the over four-year ban on exports in February, the government last month had approved an additional 2.5 million tonne (MT) of wheat exports, a move the food ministry stated would stabilise prices and prevent distress sale of the crop. With the latest round of approvals, 5 MT of wheat and 1 MT of wheat products have now been permitted to be exported after a ban on shipment was lifted in February.
This article has been republished from The Financial Express.