FCI & Food security
FCI, PDS, BUFFER STOCK & MINIMUM SUPPORT PRICE
FCI FOOD SECURITY & MSP
FCI & Food security:
- Before the harvest during each Rabi / Kharif Crop season, the Government of India announces the minimum support prices (MSP) for procurement
- MSP is fixed on the recommendation of the Commission of Agricultural Costs and Prices (CACP) which along with other factors, takes into consideration the cost of various agricultural inputs and the reasonable margin for the farmers for their produce.
Fixing procurement price - minimum support prices (MSP)
- Before the harvest during each Rabi / Kharif Crop season, the Government of India announces the minimum support prices (MSP) for procurement
- In the last few years MSP is fixed at 50% above the input cost.
FCI STORAGE & SUPPLY
Storage :
- FCI has its own storage capacity,
- FCI hires storage capacities from Central Warehousing Corporation, State Warehousing Corporations, State Agencies and Private Parties for short term as well as for guaranteed period under Private Entrepreneurs Guarantee Scheme.
- New Godowns are being constructed by FCI mainly through Private Participation under Private Entrepreneurs Guarantee Scheme.
- FCI is also augmenting and modernizing its storage capacity in the form of silos through Public Private Partnership.
Supply:
- FCI undertakes movement of foodgrains in order to:
- Evacuate stocks from surplus regions
- Meet the requirements of deficit regions for NFSA/ TPDS and Other Schemes
- Create buffer stocks in deficit regions
- Punjab, Haryana and Madhya Pradesh are the surplus States in terms of wheat procurement vis-a-vis their own consumption. Punjab, Haryana, Andhra Pradesh/ Telengana, Chhattisgarh and Odisha are surplus States in terms of rice procurement vis-à-vis their own consumption. Surplus stocks of wheat and rice available in these States are moved to deficit States to meet the requirements under NFSA/ TPDS and other schemes as well as to create buffer stocks.
On an average 42 to 45 million tonnes of foodgrains are transported by FCI across the country in a year.
Buffer stock:
Buffer stock refers to a reserve of a commodity that is used to offset price fluctuations and unforeseen emergencies. It is generally maintained for essential commodities and necessities like food grains, pulses etc.
The concept of buffer stock was first introduced during the 4th Five Year Plan (1969-74)
At present, the Government of India prefers to use the term – Food grain stocking norms – which refers to the level of stock in the Central Pool that is sufficient to meet the operational requirement of food grains and exigencies at any point of time. Earlier this concept was termed as Buffer Norms and Strategic Reserve