Informist, Tuesday, May 30, 2023

By Arunima Bharadwaj

NEW DELHI – Traders and market players are critical of the production estimates for major crops for the 2022-23 (Jul-Jun) crop year, released by the government on Thursday. They expect the output of almost all crops to be much lower than the figures estimated by the government.

The industry estimates wheat output at 103-104 mln tn, against 112.7 mln tn estimated by the government, owing to untimely rains in March.

"The government has given higher estimates because they want people to know that there is wheat in the market so that wheat prices don't shoot up," said Aniket Mehta, an Indore-based trader.

Wheat prices in wholesale markets across the country have risen from last month owing to lower production of the grain. Prices have increased by over 200 rupees per 100 kg in a month and are currently at 2,120 rupees in the key markets of Kota, Rajasthan, Mehta said.

Meanwhile, the government has not been able to fulfil its target of procuring 34.2 mln tn of wheat before the procurement season ends. As of Sunday, the government was able to procure only 26.2 mln tn in the 2023-24 (Apr-Mar) rabi marketing season, 76.6% of the total target, the Department of Food and Public Distribution said in a tweet.

Wheat procurement has been hit as arrivals at mandis are less due to low production, said Pramod Kumar S, president of the Roller Flour Millers' Federation of India.

Industry players have estimated rice production at 133.0 mln tn, lower than the government's estimate of 135.5 mln tn. Concerns about El Nino and deficit rainfall have heigntened worries about lower production of rice this kharif season, said Rahul Chauhan, director, IGrain India, a commodity market research company.

In the ongoing 2022-23 (Oct-Sep) kharif marketing season, the government has procured 78.7 mln tn of paddy till Sunday.

Among other major crops, output of tur and soybean are seen lower than the government's third advance estimates of 3.4 mln tn and 15 mln tn, respectively. Production of tur is estimated even lower than 3.0 mln tn by market participants, while soybean output is pegged at 12.4 mln tn, down 17% from the government's estimate.

Amid lower production, if monsoon rainfall is delayed, sowing of kharif crops might be affected, Chauhan said.

Tur, rice, maize, and oilseeds are major crops sown in the kharif season.  End

Edited by Avishek Dutta

For users of real-time market data terminals, Informist news is available exclusively on the NSE Cogencis WorkStation.

Cogencis news is now Informist news. This follows the acquisition of Cogencis Information Services Ltd by NSE Data & Analytics Ltd, a 100% subsidiary of the National Stock Exchange of India Ltd. As a part of the transaction, the news department of Cogencis has been sold to Informist Media Pvt Ltd.

Informist Media Tel +91 (11) 4220-1000

Send comments to feedback@informistmedia.com

© Informist Media Pvt. Ltd. 2023. All rights reserved.