Agri Business

FCI stocks come in handy

Our Bureau New Delhi | Updated on March 26, 2020 Published on March 26, 2020

Govt requires 12 million tonnes foodgrains

Finance Minister Nirmala Sitharaman’s announcement of giving 15 kg of wheat or rice free to 80-crore people over the next three months would require additional 12 million tonnes (mt) of grains.

This would be over and above the 5 kg foodgrains they already get through the public distribution system (PDS).

This move will not only help households that are impacted by the lockdown, but also liquidate foodgrain stocks available with public procurement agencies.

Liquidate foodgrain stocks

“This is a good decision by the government. It will help the Food Corporation of India (FCI) to clear a good part of the huge foodgrain stock it is currently saddled with,” said Siraj Chaudhry, MD and CEO of National Collateral Management Services Limited. “It will help procurement agencies to make space for fresh wheat stocks which, if everything goes well, will start coming in from the second half of April.

On the flip side, it may hit farmers who would sell in the open market, with prices going down owing to lower demand, Chaudhry added.

Nearly a third of wheat is sold in the open market by farmers. The government should also be careful to ensure that the bulk of grains being given away is not sold back to the FCI, the NCML official said.

Liquidating stocks is a good idea as it would bring down the carrying stock of these foodgrains, Chaudhary said.

As on March 1, the FCI had 30.97 mt of rice and 27.52 mt of wheat, totalling 58.49 mt. The FCI also has unmilled paddy stock of 28.70 mt.

The current stocks are close to three times the stipulated buffer and strategic reserves.

Assocham Secretary-General Deepak Sood lauded the package and said free ration for three months over and above the existing quantity under PDS, and making available cooking gas to the beneficiaries of the Ujwala scheme will help the poor.

FICCI President Sangita Reddy said the government will have to ensure last-mile connectivity of essential goods.

She also welcomed the announcement front-loading first PM Kisan Samman Nidhi instalment of ₹2,000 to 8.69-crore farmers.

Even though directives have been given to allow inter-State movement of essential goods, they are not clearly transmitted to check-points and, as a result, vehicles carrying essential goods continue to be held up in many places.

Published on March 26, 2020

A letter from the Editor


Dear Readers,

The coronavirus crisis has changed the world completely in the last few months. All of us have been locked into our homes, economic activity has come to a near standstill. Everyone has been impacted.

Including your favourite business and financial newspaper. Our printing and distribution chains have been severely disrupted across the country, leaving readers without access to newspapers. Newspaper delivery agents have also been unable to service their customers because of multiple restrictions.

In these difficult times, we, at BusinessLine have been working continuously every day so that you are informed about all the developments – whether on the pandemic, on policy responses, or the impact on the world of business and finance. Our team has been working round the clock to keep track of developments so that you – the reader – gets accurate information and actionable insights so that you can protect your jobs, businesses, finances and investments.

We are trying our best to ensure the newspaper reaches your hands every day. We have also ensured that even if your paper is not delivered, you can access BusinessLine in the e-paper format – just as it appears in print. Our website and apps too, are updated every minute, so that you can access the information you want anywhere, anytime.

But all this comes at a heavy cost. As you are aware, the lockdowns have wiped out almost all our entire revenue stream. Sustaining our quality journalism has become extremely challenging. That we have managed so far is thanks to your support. I thank all our subscribers – print and digital – for your support.

I appeal to all or readers to help us navigate these challenging times and help sustain one of the truly independent and credible voices in the world of Indian journalism. Doing so is easy. You can help us enormously simply by subscribing to our digital or e-paper editions. We offer several affordable subscription plans for our website, which includes Portfolio, our investment advisory section that offers rich investment advice from our highly qualified, in-house Research Bureau, the only such team in the Indian newspaper industry.

A little help from you can make a huge difference to the cause of quality journalism!

Support Quality Journalism
This article is closed for comments.
Please Email the Editor
You have read 1 out of 3 free articles for this week. For full access, please subscribe and get unlimited access to all sections.