Excess wheat causes problems for mill owners

If there is no bread, then eat cake. But if there is no flour, there will be neither bread nor cake to eat. The latter situation is expected to happen in Maharashtra, if the union Government does not revoke its policy decision of exporting wheat at a cheaper price. Flour mills in Maharashtra have threatened to close shop in the wake of the government's decision to export wheat at a cheaper rate compared to the rate of wheat sold through the Public Distribution Scheme (PDS) and open market.

Around 32 flour mills out of 78 mills in the state, have pulled down their shutters, and the remaining mills are running at about 57 percent of their capacity. ``It is not only in Maharastra, but even in other non-wheat growing states that flour mills are dying a slow death. There is a stock of 26.85 million MT (metric tonnes) of wheat and around 13.21million MT of rice, as of October 1, 2000. Out of the 26.85 million MT of wheat, 14 million MT is surplus, and the government has been unsuccessful in disposing off this, since it is highly priced. The cost of this wheat is Rs 724 per quintal, which is supplied to flour mills in non-wheat producing states in the country. The flour millers incur huge losses due to the poor quality of wheat supplied to their mills. In addition, losses are added to the cumulative expenditure, by way of reduction in weight and damages to the wheat due to rodent menance. Efforts and pleas made to government authorities concerned, to sell off this wheat to avoid undue national looses, has fallen on deaf ears,'' said Nandlal Wadhwa, the President of the Maharashtra Roller Flour Millers Association.

Wadhwa claims that the government is proposing to export the finest quality new crop of wheat at a uniform price of US $ 9000 (Rs 45,000 approximately) per MT, which roughly works out to Rs 400 per quintal. In comparison, the poor quality of wheat which is supplied to the consumers in the local market through PDS, is priced at Rs 980 per quintal while a miller is charged Rs 724 per quintal. The government ensures that the specification for export quality wheat is met before it is shipped abroad, but it never bothers to look into the problem of poor quality wheat being stacked in Food Corporation of India (FCI) godowns.

There is around 7 million MT of 2-year-old wheat stacked in FCI's godowns all over the country and another 3 million MT of new crop is being stacked since June 2000, according to Wadhwa. Even if the government utilises each and every port in India, it would be able to ship not more than 2 million MT per year.

``The truth is that if the prices would be made affordable, then FCI will be able to dispose off around 20 lakh tonnes of wheat in the domestic market . This is much more than the quantity of wheat expected to be exported. The Millers Association is willing to buy outright the same export quality wheat at a price of US$ 10 per quintal more than the price currently being offered to exporters", said Wadhwa.

By: Mani D'Mello

Photographer : Uma Kadam