In a recent disclosure by a leading flour millers’ association on Monday, India’s wheat production for the year is anticipated to reach 105 million metric tons, marking a 6.25% shortfall from the government’s projections. India, holding the position of the second-largest wheat consumer and producer in the world after China, had previously imposed an export ban in 2022. The country now leans heavily on substantial harvest yields to boost its reserves and stabilize domestic prices, which had experienced a hike due to unfavorable climatic conditions diminishing crops in both 2022 and 2023.
Navneet Chitlangia, the senior vice president of the Roller Flour Millers Federation of India, confirmed, “After assessing the crop across the country, we believe that wheat production will be 105 million metric tons this year.” This figure contrasts with the government’s optimistic forecast that India’s wheat production would hit 112 million metric tons in 2024.
In the previous year, India boasted a record output of 112.74 million metric tons of wheat, as stated by the farm ministry. However, contrary to this official statistic, trade and industry insiders have argued that the actual figures were at least 10% below the estimates provided by the government.
This dip in wheat production pressured the government to release a record quantity of 10 million metric tons of wheat from its strategic reserves to large-scale purchasers, including flour millers and biscuit manufacturers. This move resulted in a significant depletion of the stockpiles that are crucial for operating the largest food welfare program in the world.
As the figures stood at the beginning of March, government warehouses reported their lowest wheat inventory since 2017, holding merely 9.7 million metric tons. Regardless, government authorities maintain a positive outlook, expressing confidence in their capability to replenish the dwindling reserves.
As part of the restocking efforts, the state-run Food Corporation of India (FCI) is set to purchase between 31 million and 32 million metric tons of wheat from local farmers during the current year, up from 26.2 million metric tons in 2023. This was confirmed by the chairman and managing director of the FCI, Ashok K K Meena. He further reported that the FCI has already initiated procurement of the new-season wheat, securing a million metric tons from domestic farms since the onset of the latest harvest season in early April. This figure surpasses the amount from the corresponding period the year before, which was 700,000 metric tons.
In an attempt to facilitate the FCI’s acquisition of large quantities of wheat, necessary for bolstering the depleted reserves, the Indian government has approached both global and local trading entities, requesting them to abstain from purchasing the new crop directly from farmers.
The Indian agriculture sector, with a prime focus on wheat, plays a pivotal role in both the nation’s food security and its economy. The fluctuations in wheat output not only affect local markets and prices but also have a significant impact on the global industry, given the country’s size and consumption rates. As India strives to manage its reserves amid changing climate conditions and shifting market demands, the international trade houses, local farmers, and government bodies continue to navigate the delicate balance between sufficient stockpiles for food programs and market availability for producers and consumers alike.
