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Sufficient foodgrain stocks may prevent high inflation: report

AVERTING HIGH INFLATION: File photo of wheat at a retail outlet in Kerala. By June this year, the Food Corporation of India and other State agencies procured nearly 247 lakh tones of wheat. Despite poor monsoon, India's stock of foodgrains may help prevent high inflation, a broking firm said in a report on Aug. 16. Photo: K.K. Mustafah

AVERTING HIGH INFLATION: File photo of wheat at a retail outlet in Kerala. By June this year, the Food Corporation of India and other State agencies procured nearly 247 lakh tones of wheat. Despite poor monsoon, India's stock of foodgrains may help prevent high inflation, a broking firm said in a report on Aug. 16. Photo: K.K. Mustafah  

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Sufficient foodgrain stocks may prevent a high inflationary situation this year, a report published by a commodities broking firm said today.

“Poor rainfall this year can have an obvious impact on food prices, thereby impacting inflation. However, India has some respite in the form of comfortable levels of food grain stocks,” according to the report published by broking firm, Angelcommodities.

In 2002-03, the release of these stocks helped to contain rise in inflation, mainly in foodgrains. The government has declared that it has sufficient food grain stocks to meet demand under the public distribution system and other welfare schemes during 2009-10, the report said. Foodgrain stocks as on June 1 stood over 535 lakh tonnes against the Government’s annual requirement of 496 lakh tonnes. The break-up of foodgrain stocks constitutes 204.03 lakh tonnes of rice and 331.22 lakh tonnes of wheat.

In the current level of allocation, the annual requirement of foodgrains is around 446 lakh tonnes of PDS and about 50 lakh tonnes under other welfare schemes. Hence, even if the impact of poor rainfall in India will be negative, prices will be controlled from spiralling as India has adequate food stocks to manage the situation, it said.The Government’s policies will help in developing the spot markets, mandis and lead to better and efficient price discovery in agricultural commodities.

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Printable version | Jan 20, 2020 6:04:33 AM | https://www.thehindu.com/business/Sufficient-foodgrain-stocks-may-prevent-high-inflation-report/article16875228.ece

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