We've seen this story before. Search for Goodlander's posts

Quote:

http://www.reuters.com/article/2012/07/0....
Sun Jul 1, 2012

....Officials say that, in all, about 6 million tons of grain worth at least $1.5 billion could perish. Analysts say the losses could be far higher because more than 19 million tons are now lying in the open, exposed to searing summer heat and monsoon rains.

Saddomajra, a village in the bread-basket state of Punjab, is one of the dumping grounds for the record stockpile of wheat that has accumulated after half a decade of bumper harvests in the world's second-largest producer of the grain...

Quote:

Here there are thousands of sacks of decomposing wheat, occupying an area the size of a football field and towering in some places to the height of a house. Tarpaulins cover most of the mounds, but many of the bags are torn, spilling blackened grain blighted by fungus and insects.

"The wheat has been lying there for the past five years. It smells very bad," said Hakkam Singh, who works as a watchman at the open field. "Nobody steals it, but people use it to feed fish and poultry farms."

At another dump, on the outskirts of Punjab's Amritsar city, locals told Reuters that officials sometimes dip into the sacks of rotting grain to mix it with fresh wheat for distribution to the poor who hold ration cards.

Quote:

In India the government buys rice and wheat from farmers at a guaranteed price, a support system akin to the subsidies that led to Europe's notorious butter mountains and milk lakes.

The government has raised the price it pays to buy wheat by more than 70 percent since 2007, which only encourages more production. As a result, stocks are now at an all-time high of about 50 million tons, 12 times more than the official target.

Quote:

"For the last 25 years the storage capacity has not been upgraded at all," Tandon said. "Part of the grain is officially stored outside store houses, where the chance of rotting is high. There are often not enough sacks and tarpaulins, and sometimes it is dumped by a graveyard or cremation centre."

Grain stocks officially deemed as stored in government warehouses now stand at a record 82.4 million tons. However, that is about 20 million tons more than actual capacity, which means grain lying in the open is being passed off as "stored".

Quote:

New Delhi is considering the export of up to 3 million tons of wheat to sanctions-hit Iran, but traders say Tehran will not be falling over itself to buy because of concern that Indian grain may be tainted by fungal disease.

Always seems to be June and july these articles come out.

I have seen the ones for 2004 and 2005 but cannot seem to find them
previous examples:

Foodgrains rot in India's godown with no space to store
June 22, 2011
http://indiatoday.intoday.in/story/foodg....

India lets grain rot instead of feeding poor
July 26, 2010
http://www.hindustantimes.com/News-Feed/....

One crore Indians starve as grains rot in FCI godowns
http://articles.timesofindia.indiatimes.....
Jul 2, 2008, 10.25am IST

Rotten wheat makes life hell for villagers
http://www.tribuneindia.com/2004/2004053....
May 30, 2004

I wish goodlander would post more often.

About a year ago under a FOIA request the opposition party in Indian Parliament got the test results of the stored grain. 60% of the wheat and 40% of the rice was unfit for human consumption due to rot, germination, and rodent urine/fecal matter. Last calculations I did put India sitting on 24% of the worlds stored wheat. This means that 14.4% of the worlds counted wheat stockpile does not really exist. Iran backed out of a wheat for oil deal with India a week ago due to quality issues.

Moving grains in India looks a little bit different than moving grains in North America. Lots of shovelling and bag carrying goes on making delivery timing and quality control a bit problematic.

This year in India seems to be the worst in recent memory for leaving grains out to rot. A major government program for storing grains was announced last year however this seems to be moving at normal government speed (being outrun by an advancing glacier). In the past there has been lots of interprovincial movement of grains to find storage however no one has any room at all left so the grains sit close to where they were harvested.

India has had a very good run with their crops recently. Cooler temps over the last several years have been good to them, six big crops in a row is pushing the statistical envelope. A big part of the reason they have had larger crops is that more are going to tripple cropping. This adds acres but quickly reduces the yield per acre per crop. I ran the numbers on this and charted it, can't find it right now, but the downward curve of bushels/acre/crop is quite visible.

Thanks for the info goodlander!

I was over north of Delhi a couple of years ago harvest is interesting ....combines are new knockoffs on John Deere 95 models made in the 60' early 70's and the grain is piled up in a pile in each field ..then an army of men come and shovel into large gunny sacks that are then hand loaded into bob tale trucks and where it goes then I don't know there are no grain elevators to be seen...

I missed Goodlander, too. Good to see a post. Got any updates for the Crops 2012 thread?

Another issue that has caused problems in India's agriculture industry recently is the change to the welfare/workfare system. I won't get into the details here, a bit of a long and convoluted story. The end result is more difficulty and cost in procuring farm labor. India's agriculture is very labor intensive, not many 600hp tractors pulling 80 foot air seeders. This may change as the jobs evaporate from the urban areas.

As a side note it is interesting to read the deurbanization stories coming out of Greece and other affected nations. 700 year cycle closing in on completion?

Edit: forgot to mention that the 24% of stockpiles did not include this year's crop in India. Monsoon should get going shortly over there, some grain is going to get wet.

That's right about monsoon season, I just don't think about it.
Thanks Goodlander, Good to have you back.

There are no validated official numbers out however there are estimates that only 15-20% of this years crop made it into storage, the rest gets wet.

Thanks, again.

More photos of rotting wheat in the India:
http://www.seattlepi.com/news/article/In....

India .gov buys all the wheat, at the same price, "whatever the quality":
http://www.marketskeptics.com/2010/03/tr....

July 23

Thought i add something maybe of use...

DJ India Commodities Prices - Agriculture
DJ - 3 mins ago
MUMBAI--The following are Monday's prices of oilseeds, oilmeal and edible oils provided by the Solvent Extractors' Association of India.

Product Monday Friday

Oilseeds in INR/ton:
Groundnuts (Saurashtra) 50,500 50,200
Soybeans (Indore, ex-mandi) 49,250 45,500
Rapeseed (Jaipur, ex-mandi) 43,890 43,100
Sunflower Seeds (Karnataka) 39,000 39,000
Castor Seeds (Gujarat) 38,500 38,500
Sesame Seeds (Saurashtra) 81,000 75,800

Extractions for export in dollars/ton, free alongside ship, Kandla:
Soybean Meal (Yellow) 48%-2.5% 760 730
Rapeseed Meal 38%-2.5% 335 320

Oils in INR/ton:
Groundnut Oil 118,000 118,500
Rapeseed Oil (Rajasthan) 86,000 84,500
Sesame Oil 86,000 84,000
RBD Palm Olein 63,000 62,300
Crude Degummed Soyoil 72,000 71,500
Crude Palm Oil (Kandla) 57,200 57,200

Refined Oils in INR/ton:
Rapeseed Oil N.A. N.A.
Soybean Oil 76,300 76,000
Sunflowerseed Oil 76,300 77,000
Groundnut Oil 125,000 125,000Write to Debiprasad Nayak

July 23, 2012 08:38 ET (12:38 GMT)

This one might end up being a bit of an issue if the monsoon does not pick up right away, there are no signs it will. With less than a quarter of the grain put in storage (for what that is worth) and at least half of what is in storage rotten or spoiled the country is basically going crop to crop with damn little in reserve. A miss on the yields has potential to put them in some serious ****. 200 million are already undernourished and at risk in the country.

If they were to feed everyone properly (the government is responsible for doing this in India) the reserve evaporates instantly and a **** crop will put a pile of people in the Ganges.