PDS wheat ends up in the open market, price falls 20%

Balwant Garg
Tribune News Service
Faridkot, September 24

With a surge in wheat delivery through the Public Distribution System (PDS) among the Smart Ration Cardholders during the lockdown, the prices of wheat, flour, maida and suji have fallen by more than 20 per cent in September in the area.

Wheat is trading currently at Rs 1,600 per quintal in the open market against Rs 2,200 per quintal in April this year. The current market price of wheat is more than 15 per cent lower than the minimum support price of Rs 1,925 a quintal, offered by food procurement agencies to farmers during the rabi season.

Sources attributed this fall in price mainly to a large number of Smart Ration Card-holders selling the wheat they had received under the Pradhan Mantri Garib Kalyan Anna Yojana (PMGKAY) and Antyodaya Anna Yojana (AAY) during the past three months.

Other than providing 30-kg wheat at a discounted price of Rs 2 per kg through the PDS, under the PMGKAY, every smart cardholder family member was distributed 15 kg wheat free this time.

Under the AAY, every smart cardholder family was provided 5-kg wheat per member per month at Rs 2 per kg. This stock of six month makes 30 kg per member.

With an average family of four or five members getting 200-225 kg of wheat this time, its major portion was sold in the open market at the price ranging between Rs 1,400-Rs 1,500 per quintal, said sources in the Food and Supply Department.

Wheat was sold in the open market at throwaway prices by the cardholders as many of them were rendered jobless due to the lockdown, said a senior functionary in the department.

Other than this increased supply of free and subsidized wheat under PMGKAY and AAY schemes, what further gave an impetus to flood the open market with wheat was a scheme of Punjab government under which 10 lakh packets of dry rations, containing 10 kg atta, 2 kg dal and 2 kg sugar each, was distributed to daily wagers and unorganized labourers to help them through the lockdown imposed in light of Covid-19 crisis.

Punjab has about 34.62 lakh such ration cardholder families. In Faridkot district, the number of such cardholders is about 80,000 and over 3,00,000 persons have been listed as beneficiaries on these cards, revealed sources in food and supply department here.

The huge flow of wheat stock in the open market has even dampened a move of Central Food Ministry of cutting the base price of wheat by nearly 12 per cent to clear the excess stock from the central pool. Food Corporation of India (FCI) is offering wheat at Rs 1,840 per 100 kg so that to increase the offtake given overflowing stock. But as the market prices are hovering much below Rs 1,840, so the FCI is not getting much of the desired number of buyers.

Vineet Parkash, divisional manager, divisional office, FCI in Faridkot said despite the decline in the price, the FCI is also getting its share of buyers.