Cutback in public wheat procurement for the benefit of private trading companies

The all-India daily average retail price of wheat flour (atta) touched the high of Rs. 36.98 a kg, according to data from the consumer affairs ministry. The retail price of atta has increased by 17% in the past one year. This has put further burden on people, who are already facing the highest ever prices of LPG, petrol and diesel.

The government is misleading people by claiming that the price has gone up due to lower production of wheat. The wheat production has fallen only by 30 lakh tonnes to 1060 lakh tonnes, i.e., a fall of less than 3 percent. This fall should not matter when the government had stock of over 400 lakh tonnes of wheat in November 2021.

The real reason for the steep increase in the retail price of wheat is a big cutback in the government’s procurement of wheat during April-June 2022. The government procurement of wheat was only 187 lakh tonnes, compared to 433 lakh tonnes in the previous year. This cutback allowed large private traders and corporates to procure much larger quantities than in the past.

Wheat stocks in government storage has fallen to 210 lakh tonnes as of 1st November, 2022, down from 420 lakh tonnes on 1st November, 2021.

Moreover, big capitalist corporations also took advantage of the high wheat price in international markets before the ban on wheat export was recently imposed. The country’s wheat exports more than doubled during April-September 2022, compared to the corresponding period of the previous year.

All these facts show that in spite of the decision to repeal the three farm laws, the Central Government continues to act in the interest of monopoly capitalists. Decisions on the size of public procurement are driven, not by the need to ensure availability at affordable prices for all, but by the aim of expanding the role of private monopoly companies in the procurement of food grains.

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