New Delhi - A sluggish start to wheat sowing this year is giving rise to concerns that India may have to continue importing wheat next financial year to tide over a supply shortfall. According to the latest government data, wheat has been sown on around eight million hectares as of Nov 23, down 30% on year. India's wheat crop is sown from October to December and harvested in January and February. "The drop in acreage could have some impact on the final output, as any crop planted after November would not give the desired yields," said S S Singh, senior scientist at the Indian Council Of Agriculture Research. He said although sowing is still going on, the chances of any sharp rise in yield are fading fast. B Mishra, head of the government's Directorate of Wheat Research, added that farmers delaying wheat sowing beyond Nov 25 will have to pay a price in terms of low yield, as each day's delay in sowing after that date equals a loss of 25-30 kilograms in yield per day. India's average wheat yield in 2006 was 2,600 kilograms per hectare. The major losses in wheat acreage at present are coming from the key wheat-growing provinces of Uttar Pradesh and Madhya Pradesh. In Uttar Pradesh, acreage is down by almost 856,000 hectares, while in Madhya Pradesh, it's down by almost 806,000 hectares. The key reason for the drop in acreage in the two provinces is that farmers who planted sugar cane for the summer-sown crop, harvesting for which began in October, are refusing to harvest the crop. Since the same land is to be used for sowing wheat, it has created a major shortfall in wheat acreage. Sugar cane farmers in Uttar Pradesh and Madhya Pradesh are not willing to harvest their cane crop until they get adequate remuneration for their produce. Farmers in both states sell most of their cane to Uttar Pradesh-based sugar mills. Cane farmers are demanding that mills first clear last year's dues of about Rs 14 billion and make the current year's payments at the Uttar Pradesh provincial government's prescribed price of Rs 1250 a metric ton. But millers are ready to pay only around Rs 800/ton because of severe losses they are incurring due to a fall in domestic sugar prices. "The matter is now being fought in the courts, as the provincial government of Uttar Pradesh wants millers to pay the state-administered price," said Shyamlal Gupta, a member of the Uttar Pradesh Sugar Millers Association. Although Farm Minister Sharad Pawar had asserted there will be no imports of wheat next fiscal year, some agricultural ministry officials said it seems likely that India will have to continue importing wheat next financial year. India's financial year runs from April to March. Avinash Raheja, senior analyst at Commntrendz Risk Management Services, a local commodity brokerage firm, said the country may end up importing four million tons of wheat in the 2008-09 financial year, as India's wheat buffer stocks are not growing at a fast clip, while wheat acreage faces challenges from oilseeds and other competing crops. India is likely to import 2.3 million tons in 2007-08, according to the government. "Wheat imports will now become a norm rather than an exception, and despite all government efforts," the agriculture ministry official added, alluding to the fact that the country is on its way to becoming a regular wheat importing nation, such as Japan and Egypt. In fact, Pawar hinted as much in a recent speech at the federal parliament, where he said the country is likely to face a domestic shortfall in wheat supply, at least until 2009-10. "The country is expected to produce around 73.44 million tons of wheat in the 2009-10 crop year, while demand is expected to grow to 74.26 million tons, leaving a gap of around 820,000 tons," he said.

[Source: Dow Jones Newswire]