Centre’s largest grain procurement arm Food Corporation of India (FCI) is in a tizzy

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with rabi season procurement to begin in Gujarat first from next week and then in Punjab from April 1.

FCI is worried over lack of adequate storage capacities, given the higher wheat output expected from this year’s rabi season crop. To get over the capacity crunch, FCI is desperately scouting for private space across the country under a freshly introduced one-year rental guarantee scheme.

“We had a good response to the one-year scheme after it was introduced in south zone in January 2011. It will now be underway in Punjab. We are hopeful of a better responses,” FCI chairman Siraj Hussian said.

With more than two-thirds of central food pool’s 46 million tonne grains stored in Punjab and another 82 to 83 million tonnes wheat harvest expected in next few weeks, this year Punjab food and civil supplies minister Adesh Pratap Singh Khairon insisted that centre take responsibility of hiring private storage space in the state.

“Our state warehousing and grain storage agency is overburdened since October when record rice harvest started to arrive. The centre has since then ignored our pleas to move rice stocks out of the state. So we had to ask FCI to look for wheat storage space elsewhere as well,” said Punjab’s food and civil supplies department secretary, SP Singh.

Punjab government’s agency Pungrain arranges storage space for more than 3.8 million tonnes food grains by hiring private godowns compared to a mere 41,000 tonnes space hired from private owners in the state by FCI.

“More space in Punjab as well as elsewhere will be taken up under the one-year rental guarantee scheme. It would be extended to other states like Maharashtra and Andhra Pradesh where storage infrastructure is readily available from private owners,” Hussain said.

“Spaces in southern zone are under finalisation and we will look to have significant storage for three million tonne additional food grains,” he added.

With rentals likely to be higher than Rs 5.52 per quintal per month, responses to the scheme had been good from godown owners in the northern states, FCI officials said. This new scheme will run in addition to a 10-year gurantee cover provided for construction of new godowns already underway since last year, but responses have been slow.

FCI top official reiterated that proposals for up to six million tonne new storage space under the 10-year scheme has been received so far. “Significant work would be undertaken under the 10-year scheme, so it is taking a little time to finalise the applications received,” Hussain said.