iGrain India - The government is facing significant challenges related to the storage of rice amid ongoing procurement efforts. As paddy is being bought from farmers at the minimum support price (MSP) and allocated to rice millers for custom milling, the situation is expected to worsen when the millers start supplying rice.
The key issue is the lack of adequate warehouses or godowns for the safe storage of the rice, as the existing warehouses are already filled with large stocks of rice.
This problem is compounded by the fact that the government has reduced its rice procurement target for the Kharif season to 492 lakh tonnes, a decrease of 29 lakh tonnes compared to last year.
Additionally, procurement has been slower than last year, with 48% less rice being purchased by October 15, 20% less by October 31, and 11% less by November 15. Despite improvements in the procurement rate, this shortfall in storage capacity remains a serious concern.
Punjab, the leading contributor of food grains to the central pool, has seen the highest procurement so far, though it is still below last year's figures.
The government had set the MSP of paddy at Rs 2300 per quintal for general category and Rs 2320 per quintal for 'A' grade, but the slow pace of lifting paddy from the mandis has left farmers struggling.
Meanwhile, paddy harvesting is underway in other key states like Chhattisgarh, Telangana, Odisha, Andhra Pradesh, Madhya Pradesh, and Bihar, which will further increase the government's procurement needs in the coming weeks.