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Harish Damodaran

NEW DELHI, June 3

THE Agriculture Ministry is likely to revise downwards its estimate of the 2001-02 wheat crop, currently being marketed. The Ministry's `second advance estimates' of total foodgrain production for 2001-02 (prepared on January 22) had reckoned the crop at 73.06 million tonnes (mt), which was subsequently raised to 73.53 mt in the `third advance estimates' released on April 5.

However, according to highly placed sources, the `fourth advance estimates', to be prepared by the end of the current month, may well see a downward revision in the crop size. ``We won't be surprised if last year's wheat output is re-assessed at 70-71 mt'', the sources said.

A major factor apparently prompting Krishi Bhawan to rethink its initial estimates has been the unexpected dip in wheat procurement by Food Corporation of India (FCI) and State Government agencies during the ongoing 2002-03 rabi marketing season (April-June).

As on Friday, total official procurement stood at 18.40 mt, which was below the corresponding 19.64 mt figure for the 2001-02 season.

Wheat procurement for the entire 2001-02 marketing season had amounted to a record 20.63 mt, despite the 2000-01 crop (harvested last year) being only 68.76 mt — almost eight mt lower than the previous year. With wheat production recovering to 73.5 mt and the Centre also hiking the minimum support price to Rs 620 per quintal, wheat procurement this year was officially projected to cross 23 mt.

But from available trends, it looks as though total Governmental purchases of wheat will not even touch 20 mt, let alone last season's all-time high. Procurement in Punjab so far has been only 9.86 mt compared to 10.53 mt during this period last year. Progressive purchases have also been lower from Haryana (5.88 mt versus 6.37 mt), Uttar Pradesh (1.56 mt versus 1.63 mt) and Rajasthan (4.57 lakh tonnes versus 6.45 lt). Only in Madhya Pradesh has procurement been higher at 3.96 lt (2.85 lt).

Moreover, even overall wheat arrivals in mandis (where Government agencies are present) have been lower, at 19.29 mt, against last year's 20.53 mt. Progressive arrivals have fallen in Punjab (from 10.54 mt to 9.87 mt), Haryana (from 6.37 mt to 5.89 mt), UP (from 1.91 mt to 1.71 mt) and Rajasthan (from 9.77 lt to 7.54 lt), while rising from 4.91 lt to 7.93 lt in MP.

``The much bigger wheat crop this time has been predicted on MP and Gujarat recovering from the previous year's drought. But it appears that some of these gains in central and western India have been offset by unanticipated losses in the traditional North-western wheat belt,'' the sources pointed out.

The trade estimates Punjab's wheat production alone to be over one mt below last year's level of around 15.5 mt. ``Compared to 20 quintals in the last two years, average per acre yields have been roughly two quintals lower this time,'' said Mr Nirmal Parkash Sofat, President of the State's Arthia (commission agent) Association.

Although the quality of grains arriving in the mandis has been `top class' in terms of lower moisture content, zero lustre-loss and negligible incidence of Karnal bunt or black point, ``the better quality has not been accompanied by higher yields'', he added.

The end-result of this is that the Agriculture Ministry may have to significantly revise downwards its estimates of wheat output for 2001-02. This is in marked contrast to the situation in 1999-2000, when output estimates were subjected to successive upward revisions - from 68.74 mt in January 2000 (`second advance estimates') to 70.10 mt in March 2000 (`third advance estimates'), 74.25 mt in June 2000 (`fourth advance estimates'), 75.57 mt in January 2001 (`final estimates') and 76.37 mt in January 2002 (`fully revised').

While such huge periodic revisions undoubtedly raise questions about the sheer credibility of the official agricultural statistics collection machinery and quality of market intelligence, an over-estimation of production this time round, however, is something that policymakers may perhaps welcome.

As on May 1, foodgrain stocks in the Central pool amounted to 62.55 mt (38.10 mt of wheat and 24.35 mt of rice). Assuming additional wheat procurement of five mt during May-June and average foodgrain offtake of 2.5-3 mt for these two months, total grain stocks would touch 61-63 mt by July 1. This is way below the 75 mt plus levels that was being projected until recently.

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