BUSINESS
A report stated that one kilo of wheat in India is resulting in 720 grams of flour this year, a fall from around 770 grams.
India is going through wheat shortage due to which the Modi government has announced a ban on its wheat exports. The wheat shortage has risen due to extreme heatwave conditions since April and the ongoing Russia-Ukraine war which has led to the halt in supply. This year, India experienced the hottest March month in 122 years.
But what is even more worrying is that the same quantity of grain is now giving less flour due to a fall in its quality. A report stated that one kilo of wheat is resulting in 720 grams of flour this year. Earlier, it used to be around 770 grams. This shortfall may lead to 6.5% fewer chapatis in India this year.
Read | India will continue to export wheat to needy, friendly countries: Union Minister Piyush Goyal
The Indo-Gangetic Plain is one of the main wheat-production regions in India and the world. With climate change, wheat yields in this region will be affected through changes in temperature and precipitation and decreased water availability for irrigation. This is raising major concerns for national and international food security.
Wheat requires cold temperature to flourish. Due to hot weather, the wheat production in India may fall below 100 million tonnes in 2022. It is nearly 11 million tonnes below the government estimates of 111 million tonnes. India's wheat exports hit 8.7 million tonnes in the fiscal year ending in March, with the government predicting record production levels, some 122 million tons in 2022.
In February, the government forecast production of 111.32 million tonnes, but it cut the forecast to 105 million tonnes in May as a spike in temperatures in mid-March meant the crop could instead be around 100 million tonnes or even lower.
Wheat prices have risen more than 60% this year, driven up by disruption from Russia's invasion of Ukraine. The ongoing Russia-Ukraine war has upset the wheat exports in 55 countries. Both Russia and Ukraine accounted for about 25% of world's wheat exports.
The impact of low production can be seen in the Public Distribution System also. The Food Corporation of India (FCI) which procures wheat from the farmers for the purpose of distributing it to the poor, is likely to procure nearly half the amount of wheat it purchased in 2021. Last year, the government body procured 43 million tonnes. This year, they are expected to procure just 19.5 million tonnes.
1. If the wheat stockpiles reduce to alarming levels, the government can replace it with more rice in the Public Distribution System.
2. Imposing limits on the stock kept with the traders. This may force the hoarders to release some stock in the markets to ease the prices.
3. Lithuania has proposed a protective corridor for grain shipments from Russia and Ukraine. This may release some pressure on India.