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FCI too may not get to import wheat
THE government is all set to scrap good Corporation of India (FCI)’s offer to buy up to 1 million tonne of Wheat in the near term from select overseas suppliers. This was FCI’s first attempt to import wheat directly is more than a decade. Food ministry officials, however, are none too displeased. Expected imports have already persuaded Indian farmers to bring their withheld grain to the market for the government to procure for the public distribution system and welfare programmes.
But the food ministry, which agreed with its commerce counter-part that the go ahead for issuing wheat import tenders for one million tonne through the STC, was against FCI’s import plans from the beginning, tending to agree with the commerce ministry that despite the FCI’ long track record in grain transport and buys, even imports in earlier times, the STC and other state agencies were currently more in the groove on imports.. The last date to respond to the offer was April 30 am the response to the FCI tender was very poor with only two parties, on from New Delhi and another Iron Mumbai, responding. Price quote; too, are believed to have been way higher than the lowest $263 per tonne quote for the STC wheat import tender for one million tonne. That tender, in contrast, was considered t have been more open and direct.
Ministry sources refused to divulge the specific reasons why the thumbs down signal was set to be given to the import move, but said a number of influences go into the government’s decision to not give its nod to the offer, a formal announcement is likely t come soon, within a week. Intrinsic flaws in the offer that led to tardy responses from wheat import majors could be one key reason. A special feature of the tender was that technically, the onus of hedging the price risk was passed on to the supplier. These developments had led to heavy speculation that FCI was non-serious about the tender and was primarily meant t strong-arm farmers into releasing hoarded wheat into the mandis.
More recently, there have bee healthy and optimistic developments for the Centre on the food grain procurement front that have paved the path all the more for the thumbs down to the FCI’s future option offer. The current procure merit trends have led to the conclusion that the Centre may not need t import more than two million tonne of wheat, at the most, to make up it four million tonne quota stock at the end of the year.
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