Government procurement of wheat expected to be better than last year

03-Apr-2025 01:37 PM

This update on wheat procurement in India for 2025 highlights a significant increase compared to the previous year, with government purchases showing strong momentum in key states.

Key Takeaways:

  • March 2025 Procurement: 8.50 lakh tonnes, up from 2.50 lakh tonnes in March 2024.

  • Madhya Pradesh Leading:

    • Highest procurement due to a high price of ₹2600 per quintal (MSP ₹2425 + ₹175 state bonus).

    • Increased arrivals, leading to softening wheat prices.

  • Rajasthan Procurement:

    • 40,000 tonnes purchased by government agencies.

    • Farmers receiving ₹2575 per quintal (₹2425 MSP + ₹150 bonus).

    • Quality standards for MSP wheat have been relaxed, which will boost procurement.

  • Punjab-Haryana Procurement Begins (April 1):

    • Government agencies expected to dominate purchases due to high market fees discouraging private buyers.

    • Punjab remains the largest contributor to the central wheat pool.

  • National Procurement Target: 313 lakh tonnes, higher than last year's 266 lakh tonnes.

Market & Policy Implications:

  • Strong procurement signals government support for farmers through MSP and bonuses.

  • Higher arrivals and procurement may stabilize wheat prices.

  • Policy adjustments in Rajasthan (quality relaxation) encourage more government purchases.

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