Karan Vandana , a new hybrid wheat variety which is resistant to yellow rust and white blast and can give significantly higher yield than normal varieties, is likely to be soon launched across the country.

This is good news for farmers as it will reduce their unit cost and improve returns.

However, unless the Centre finds a way to handle the additional supply that will follow this move, the price of wheat grain may plunge and add to the already high distress in rural India.

Karan Vandana (DBW – 187)

The variety was developed by the Indian Institute of Wheat and Barley Research (IIWBR) under ICAR (Indian Council of Agricultural Research). Every year IIWBR launches a few new hybrid varieties in wheat and barley on a test basis in select markets. If trials produce encouraging results, the institute gets the Centre’s approval to launch it across the country. Last October, it introduced a variety — DBW - 187 — popularly called Karan Vandana in the North-Eastern States on a trial basis.

The variety produced very good results. It gave a yield of 7.8-8 tonnes/hectare compared with 6-6.5 tonnes/hectare by normal varieties. It also proved to be very effective in resisting attack from yellow blast and white rust disease, which are a major threat across wheat fields in the country.

Karan Vandana flowers in 77 days and matures within 120 days of sowing. Its average height is 100 cm. The variety also produces better-quality chapattis with 7.7/10 score and a high iron content (43.1 ppm (parts per million)) in the grains, according to IIWBR. But it, however, can be cultivated only in areas under full irrigation support says GP Singh, Director, IIWBR. “You can harness maximum yield in this variety only when you give full irrigation support.”

Supply in excess of demand

FY2018-19 was the third consecutive year of record production in wheat. The total output was over 102.19 million tonnes in 2018-19 — helped by increased MSP (minimum support price), raised bonus by the States over and above the MSP, and higher yield through new varieties of hybrids. Annually, the country needs 91-93 million tonnes of wheat for human consumption and 4-5 million tonnes as poultry feed. So, at over 100 million tonnes, there is already excess supply in the market.

With high procurement in MY2018-19 and MY2019-20, Food Corporation of India’s (FCI) granaries are also overflowing with stocks. As of July 1, FCI had a total stock of 45.83 million tonnes of wheat, when the strategic buffer requirement is just 41.12 million tonnes. There have not been many takers of the grain at FCI’s open-market sale as millers and bulk buyers are already loaded with stocks purchased directly from the market.

One positive development for farmers has been the hike in import duty on wheat in April from 30 to 40 per cent. Consequently, there has not been price pressure from imported low- cost wheat.

Over the past few days, there have been signals of the price starting to inch up as the market has entered the lean arrival season. But that said, with the stock built up with the FCI, market analysts feel that the price may not go up significantly from the current level.

From shortage in wheat grain nearly a decade ago, how did India find itself in a situation of excess supply. There are a few reasons.

One, area under cultivation of wheat increased — from about 25 million hectares in 2000-01, it is about 30 million hectares currently. Next, yields have also gone up. From an average of 2.7 tonnes/hectare in 2000-01, yield in wheat increased to 2.98 tonnes/hectare in 2010-11 and to 3.17 tonnes/hectare in 2011-12, and a further increase to 3.37 tonnes in 2017-18.

This has been thanks to the new hybrid varieties in wheat and increased irrigation support. The total area under wheat that was irrigated was 88 per cent in 2000-01, but this stood at 94 per cent in 2014-15 (the latest data available). Thus, production of wheat which was around 70 million tonnes in 2000-01, is at over 100 million tonnes now. (The yields mentioned above are the average for the country. While Madhya Pradesh, Gujarat and the eastern States have lower yield, in Punjab, Haryana and West Uttar Pradesh, the yield is over 5-5.5 tonnes/hectare).


Prospects for exports

India’s wheat exports have been declining steadily over the past five years. There are two reasons for this. One, there is already excess supply in the global markets with surplus production. Two, the Indian price has been far higher than international prices, rendering it less competitive in the global market. While the Indian price is about ₹20,000/tonne, international prices are at ₹11,534/tonne (US NO 2, Soft Red Winter Wheat).

The average yield in wheat may rise from the current 3.37-3.5 tonnes to 4.5 tonnes/hectre or more per over the next few years, which will push production substantially higher.

The government need to have strategies to market our wheat in place before it sets out to increase production significantly. Otherwise, we will be caught in a similar mess as we are in pulses now.