February 28, 2024


Delighting finance buffs

Lockdown impact: Despite bumper wheat crop, Haryana, Punjab farmers may not harvest profits

Yield from Punjab and Haryana makes up around 70 per cent of the wheat central pool which is distributed through the public distribution system (PDS) in India. During 2019-20 both states contributed 129.12 LMT and 93.2 LMT respectively which was higher as compared to 2018-19 when the two states contributed 126.92 and 87.84 LMT of wheat.

This year Punjab and Haryana are expected to procure 135 LMT and 90 LMT of wheat respectively despite lockdown restrictions.

“75 to 85 per cent harvesting has already been done in Punjab and Haryana. Around 40 million tonnes out of an expected 135 lac tonnes of wheat has already reached grain markets. Expected procurement in Haryana is 90 lac tonnes. We experienced that between April 15 to April 20. The pace of procurement is higher this year as compared to the last year,” says food and trade policy analyst Dr Davinder Sharma.

According to Dr Sharma, the procurement rate in Punjab is 61 per cent higher in the first 10 days of procurement as compared to the corresponding period last year. This indicates, says Davinder Sharma, that the procurement this year will surpass last year’s quantity. Punjab will procure more than 135 lac tonnes this year.

Farmers may not harvest profits despite a bumper crop

The farmers in both the states of Punjab and Haryana may not be able to harvest profits despite a bumper wheat crop. One, the yield per acre is less in some parts as compared to the corresponding season. Longer rainfall season, hailstorms and windstorms damaged the crop which resulted in a drop in yield — at least five to seven quintals per acre.

The untimely rains have shrivelled wheat grain in many Haryana and Punjab districts. Dampened wheat in Punjab can also result in less procurement at least by five to 10 LMT. Only 12 per cent moisture content is permissible for procurement and the moisture in many grain markets is above 18 per cent which means the grains will not be lifted by Food Corporation of India.

“The minimum support price (MSP) for wheat set by the government did not reflect the farmer’s cost, a complete denial of the MSP would add to the problems farmers are facing. We have therefore demanded that it’s not too late even now to increase the limit of the moisture contained from 12 to 18 per cent,” Congress leader Randeep Singh Surjewala said.

Dr Davinder Sharma has also demanded the release of a bonus to save the wheat farmers from the loss.

“Intermittent rainfall and staggering besides piecemeal lifting have troubled the farmers a lot. Though the arrival in grain markets is higher but delayed harvesting and increased labour costs and weather can reduce profits. Production cost will rise. The government should give a bonus of Rs 100 per kg, this will also act as an economic stimulus because harvesting the crop and then storing and lifting in parts will cost more. The additional burden to the wheat farmer should be shared besides the Rs 1,925 per quintal MSP. Rs 7,000 should be given through the Kisan income scheme to farmers to support them,” says Dr Davinder Sharma.

The farmers also paid a heavy price for the broken supply chain after the Covid-19 induced nationwide lockdown was imposed. Perishable crops like fruits, vegetables were left to rot in the fields. The lockdown also compelled the farmers to sell items like milk at a reduced price of Rs 10 per litre. However, the consumer continued to pay more.

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