BUYING LOW QUALITY WHEAT BY GOVERNMENT, GOOD FOR FARMERS AND TRADE
CONSUMERS TOO SHOULD BE PROTECTED.
By the time this article appears, the Government would have procured more than 20 million tons of wheat this year from various States, in addition to 17 million tons of carry in stock as of 1.04.2015. Apart from good milling quality and pursuant to relaxation in specifications, lustre loss variety is also bought in abundance; broken and shrivelled percentage in grains is enhanced from 6% to 9%-10%; moisture content is raised from 12% to 14% across the board. Though value cuts were intended to be applied initially, they were later foregone; sellers/farmers will now realize full MSP value of Rs 1450/qtl.
Such relaxations are subject to condition that this deficient quality will be consumed within procuring States under TPDS and welfare schemes. FIFO—first in first out –mandate that is applied for stock distribution to official stocks will not apply for current dispensation. That means older grains of previous years can stay stocked while latest /current year acquisitions will be destocked first.
A practical approach is adopted by Food Ministry due to exigencies arisen out of exceptional climatic conditions in February and March 2015. Government should not hesitate in procurement of low quality wheat as all shades and grades of wheat are abundantly marketable at a price. Traders do not have the financial muscle to buy large tonnages at the harvest time and official intervention is helpful both for farmers and the trade.
Prima facie, FCI and State Government Agencies (SGAs) will have in their possession four broad categories of wheat—first, FAQ (fair average quality) or common grade milling type; second, lustre loss class—the one which has lost its sheen and reportedly gives lesser flour yield; third, which could be any of these two classes indicated earlier but with elevated percentage of broken/ shrivelled content; four, which is inedible for human consumption due to lack of hygienic handling/ warehousing. Third and fourth categories can be straight way classified as “feed wheat”.
Grain quality is characterized into two main factors (i) intrinsic and (ii) extrinsic. The intrinsic factors of grain include color, nutrients, bulk density, odour, aroma, size and shape. Color is an important primary factor for characterization and grading, trade, and processing of grain. It is a common criteria used in wheat trade and thus lustre loss qualifies as a deficiency in intrinsic factors. The extrinsic factors includes, age, broken/damaged grain, immature grain, foreign matter, infected grain and moisture content. Lustre loss wheat may require blending with better quality grain and likewise flour yields may be affected by higher shrivelled proportion.
FCI’s “quality control” parameters as listed on its website are also silent about three “intrinsic” constituents-- a) bulk density –technically called test weight—which is varies usually between 74-78 kg/hectolitre( b) protein content that fluctuates around 9%-14%;(c) gluten content—the measure of stretch- ability of flour, which hovers around 22%-28%. Export tenders of FCI have been stipulating all forms of refractions/ constituents and Indian wheat complies with these requirements.
What is required now for the FCI is to descript in detail the missing elements of protein, test weight and gluten in tabulated form in quality control protocol for all the four categories of wheat that are now available in its system.
Russian wheat is classified as No.2, No.3, No.4, respectively by calibrating it with protein content of 13.5%, 12%, 10% and No. 5 type is termed as feed wheat. They are also priced in the sliding scale. USA /EU/Canada have similarly differentiated their grains as soft, hard and feed wheat etc. Identity determination is critical in the Indian context this year especially when ubiquitous tonnages of sub-optimal quality of wheat are distributed under PDS and welfare schemes.
It is incumbent upon the Government to take following actions--Segregate the good wheat from lustre loss and other flawed varieties; list out the parameters and refractions of varied groupings; differentially calibrate their prices for OMSS purpose; let the TPDS and users of other welfare schemes know the type of wheat being made available to them lest there be resentment by the PDS users for serving them with less than the best quality of wheat.
Notwithstanding the above, there is a very large market of lustre loss quality and de-weathered grains as feed wheat in India and abroad. Demand for feed can easily fetch Rs 10/kg (equivalent to maize prices) versus Rs 4-6/kg for BPL and APL and Rs 2/kg in AAY scheme. It will make economic sense to auction lustre loss and other bulk grains with 9-10% broken/ shrivelled content. Millers can blend this wheat with good quality produce. Traders can consider exporting if auction price is about Rs 10/kg or so and feed /food millers abroad.
Selling all four types of wheat by FCI/SGAs at “one fixed” OMSS price is illogical. Initiative must come from government in rating the prices of deficient varieties for marketability or let the price discovery be arrived through auction/tendering. In fact good quality/FAQ wheat –whether of current or earlier years –should be supplied under TPDS and other welfare schemes for prevention of any political controversy while other types can be disposed of as suggested.