The wheat trade is expressing skepticism towards the Ministry of Agriculture’s wheat production estimate for this year, which stands at a record 115.43 million tonnes (mt). They are not convinced with the data and believe that the actual output may be lower.
Disputing the production survey conducted by the Roller Flour Millers Federation of India (RFMFI), which projected 110 mt, the trade believes that the wheat output for 2025 could range between 104-106 mt. They also rejected the Ministry of Agriculture’s estimate of 113.25 mt from last year.
A North Indian miller, speaking on condition of anonymity, stated, “We don’t accept the projections of RFMFI this year. We don’t agree with the Ministry of Agriculture’s forecast last and this year.”
The trade is concerned about the lack of wheat stocks despite the government’s projections. They feel the supply is constrained, with a South India-based miller commenting, “If the government projected a record 113.25 mt of wheat production in 2024, where are the stocks? We are feeling the pinch in supplies.”
Sumit Gupta, CEO – Asia Business, McDonald Pelz Global Commodities, highlighted at a wheat conclave in Goa that traders are estimating wheat output to be in the range of 82-105 mt, with consumption ranging from 85-98 mt. The industry has been consistently pegging production lower since 2023 due to various factors affecting crop yields.
The wheat trade believes that production has plateaued and is struggling to meet rising consumption levels. They are questioning the methodology used by the government to arrive at their production estimate. However, both the trade and analysts agree that consumption is on the rise due to changing food habits and lifestyles.
Weather-related issues in key wheat-growing states like Punjab and Uttar Pradesh have impacted crop quality, with concerns over grain size. The trade remains doubtful about the accuracy of the government’s production figures, especially with above-normal temperatures predicted by the India Meteorological Department for March.
Looking ahead, the trade emphasizes the need for vigilance in monitoring wheat prices, policy changes, and global trends. There is a consensus that wheat supply and distribution in the country require a significant boost in production to meet growing demand. Importing grains could be necessary to address domestic inflation and ensure ample availability.
As the wheat supply chain braces for challenges in the coming months, industry experts stress the importance of building buffer stocks to mitigate risks associated with weather cycles. The trade urges the government to adopt market-linked structures to reduce uncertainty and facilitate imports when needed.
In conclusion, the wheat trade remains cautious about the upcoming months, citing uncertainties related to production, procurement, and imports. The sector is closely monitoring temperature fluctuations and their potential impact on this year’s wheat crop.
