NEW DELHI: In a way 2006 was a difficult period for Food, Public Distribution and Agriculture Minister Sharad Pawar, as he grappled with high prices of essential commodities, low stocks and low production of wheat, hardening of international prices and suicide by farmers.

It was only towards the end of the year when wheat and sugar prices showed some stability and rabi coverage of wheat was higher than last year that the Minister heaved a sigh of relief.

The year was significant in that the country imported 55 lakh tonnes of wheat to maintain stocks and buffer for the Public Distribution System and welfare schemes. In addition, traders and roller flour millers were allowed to import additional quantities at zero duty on private accounts to maintain market availability. Restrictions were brought back on the storage of wheat and pulses in a bid to de-hoard the commodities and hold the price line, although with little success. The price of wheat and its products ruled high in the domestic market, pushing the inflation rate.

The Government had to go in also for higher import of pulses (about 50,000 tonnes so far) as the prices of the "poor man's protein" skyrocketed. Sugar prices also surged ahead and remained at Rs. 21 a kg in most retail markets. Consequently the Government declined to remove the export ban on sugar and pulses despite pressure from industry.Forward/commodity markets, and cornering of wheat arrivals at mandis by private traders and multinationals after the amendment of the Agriculture Produce Marketing Committee Act also impacted wheat availability for the central pool. Weather hit wheat production, which was 68.5 million tonnes against an initial estimate of 74 million tonnes. The procurement by the Food Corporation of India and regional agencies dwindled to 92 lakh tonnes against a target of 142 lakh tonnes.

On the brighter side, rice procurement during 2006 was a record at 276.6 lakh tonnes compared to the previous best of 246 lakh tonnes in 2004-05.

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