India looks down the barrel of a possible wheat crisis in the wake of recent heatwave

INDIA- The Indian government is going to be confronted with a crisis that it has never faced before– shortage of wheat, one of India’s key staples.

An unusual heat wave in March which saw temperatures reach record highs caused damage to standing wheat crop across Northern India.

The ministry of food had sent a team of scientists to Punjab to assess the extent of the damage, their evaluation was that full growth of wheat grains in the field was hampered and the grain were shriveled and under-weight.

The team, has stated in its report that the extreme temperatures increased shriveled grain percentage to 10-20% in the state.

According to Sudhanshu Pandey, food secretary, the projected wheat output has been downgraded from the estimated 111.32 million tons to 105 million tons in the 2021-22 crop year.

This represents a nearly 6% dip in wheat output this year compared with the estimated target and a 4% shortfall compared with last year’s harvest of 109.59 million tons.

In light of this, Prime Minister Narendra Modi chaired a meeting to review various aspects of wheat supply, stock, procurement and exports.

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Government officials estimate wheat procurement in the 2022-23 marketing year at 19.5 million tons. A 55% drop from last year’s procurement of 43.3 million tons and one of the lowest in recent memory.

This shocking decline in procurement is attribute to a number of reasons. These include: lucrative export prices leading private traders to buy up wheat from farmers, holding back of wheat harvest by farmers in hope of better prices and, of course, the dip in output itself.

Still, despite the drop in procurement the stocks remain at a comfortable position. According to the food and public distribution department’s monthly Food Grain Bulletin, wheat stocks in the Central pool were 18.99 million tons in April this year.

Although this is 30% less than last year. Officials are calm as the food stock norms direct that at this time of the year, only 7.46 million tons of buffer stock of wheat is needed.

India is aiming at exporting 10 MT of wheat in 2022-23. “There is no case for controlling exports of wheat at present,” sources said.

However, with the domestic prices of wheat ruling above MSP, the government is likely to take measures to restrict exports to avoid domestic supply constraints.

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