India Wheat Procurement Drops 40% Amid Delayed Madhya Pradesh Buying by Amit Gupta Kedia Advisory
India’s wheat procurement has declined nearly 40% year-on-year to 51.34 lakh tonnes as of April 16, mainly due to a delayed procurement start in Madhya Pradesh. While Punjab and Haryana have shown improved buying trends, overall procurement remains weak. The government introduced quality relaxations in Punjab after similar steps in Haryana to accelerate purchases amid crop damage from unseasonal rains. Madhya Pradesh procurement sharply dropped despite offering a bonus over MSP. Lower arrivals in Uttar Pradesh and Rajasthan also weighed on total procurement. Relaxed norms on grain quality are expected to support procurement momentum in the coming weeks.
Key Highlights
* Total wheat procurement falls 40% YoY to 51.34 lakh tonnes
* Madhya Pradesh procurement drops sharply due to delayed start
* Punjab and Haryana procurement show strong year-on-year growth
* Government relaxes wheat quality norms amid unseasonal rains impact
* Lower arrivals in UP and Rajasthan further pressure overall procurement
Wheat prices are expected to remain firm in the near term as India’s procurement activity has seen a significant slowdown, declining nearly 40% year-on-year to 51.34 lakh tonnes as of April 16. The reduced supply inflow into government stocks is likely to support market sentiment, particularly as arrivals in key producing states remain uneven.
The primary factor behind the weak procurement performance is the sharp drop in Madhya Pradesh, where buying stood at just 3.43 lakh tonnes compared to 40.08 lakh tonnes last year. This decline is attributed to a delayed start in procurement operations despite an early announcement. However, the state has offered a bonus over the Minimum Support Price (MSP) of ?2,585 per quintal, which may gradually improve arrivals.
In contrast, Punjab and Haryana have reported stronger procurement trends, supported by the Centre’s decision to relax quality norms. Punjab procurement rose to 5.94 lakh tonnes, while Haryana reached 37.74 lakh tonnes, both higher than last year. Daily procurement volumes in these states have also shown improvement, indicating better market participation.
The government’s decision to relax limits on luster loss and shrivelled grains comes after unseasonal rains in March and April impacted crop quality. These measures aim to prevent distress sales and ensure farmers receive adequate support. However, procurement in Uttar Pradesh and Rajasthan remains lower compared to last year, adding pressure on overall volumes.
Finally, lower procurement and weather disruptions may keep wheat prices supported, while policy relaxations and improved arrivals in key states could stabilize supply dynamics in the coming weeks.
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