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Tuesday, Dec 16, 2003

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FCI decision on grain export allocation in Jan

Harish Damodaran

`We will get a clear picture about Andhra Pradesh by the middle of next month and that should be the time for us to decide whether to resume fresh allocations for exports.'

New Delhi , Dec. 15

THE Food Corporation of India (FCI) will take a decision on resumption of fresh allocation of foodgrains for exports in the middle of January, by which time a clear picture would emerge about its stocks position, especially in respect of rice.

``We are examining current procurement trends for rice, particularly in Andhra Pradesh. If the rice procurement from that State turns out to be significantly higher, we can definitely think in terms of re-starting allocations for exports,'' said Mr V.K. Malhotra, Managing Director, FCI.

The 2003-04 kharif marketing season had begun with rice stocks in the central pool, at 5.24 million tonnes (mt) as on October 1, plunging to a 11-year-low and below the prescribed minimum buffer norm of 6.50 mt for that date. While wheat stocks, at 18.43 mt, were higher than the buffer norm of 11.60 mt, total foodgrain inventories of 23.68 mt as on October 1 were still the lowest for that date since the 15.34 mt level of 15.34 mt of 1997.

During the current season, FCI and State agencies have so far procured about 9.7 mt of rice, compared to the previous season's corresponding level of 8.9 mt. While FCI officials believe the total procurement will end up higher than the 16.41 mt of the 2002-03 season, a great deal would depend though on how much Andhra Pradesh delivers to the central pool this time. Acute drought conditions last year had resulted in the State contributing just 2.6 mt in the 2002-03 season, against its normal quota of 6.5-7 mt.

"We will get a clear picture about Andhra Pradesh by the middle of next month and that should be the time for us to decide whether to resume fresh allocations for exports", Mr Malhotra said.

FCI has, since August 11, stopped issuing fresh allocation or release orders for exports. Further, exporters have also not been able to take delivery of grains against pending orders due to non-availability of railway rakes. As on December 1, 19.78 lakh tonnes of wheat and 2.32 lt of rice are still to be lifted by exporters against allocations made during the quarter prior to the present one (October-December).

Meanwhile, the FCI has proposed to hike its export prices by Rs 300 per tonne for rice and Rs 500 per tonne for wheat with effect from January 1.

The lifting of grains, even for allocations made prior to August 11, would have to be done at the new prices. Even if 250 rakes (each of 2,350 tonnes) are moved this month, the additional cost that exporters would have to fork out on this count will work out to about Rs 75 crore.

"We are bearing this for no fault of ours. If sufficient rakes had been made available to us, we could by now easily have cleared all our pending allocations orders", an exporter pointed out.

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