India's huge wheat store in danger of rotting
An enormous Indian wheat stockpile with enough to more than 200 million people for a year is starting to rot through lack of room to store it.
Government estimates show nearly 18 million tonnes of wheat are exposed to the elements - stored outdoors in India's pounding monsoon rains.
As it wastes, it promises to drive global wheat prices, up 78% since June, even higher.
The government, faced with options more unpalatable to it than rotting food, has been letting the mountain of wheat grow.
Exporting the grain would be politically explosive because food inflation has been in double digits for months. The government buying less wheat from farmers in a country where over half the population makes its living off the land is equally untenable.
Selling more at subsidised prices to the poor has been ruled out because it would add to a swelling fiscal deficit.
"The government is acting like the biggest hoarder," said Biraj Patnaik, a principal adviser to the Supreme Court on right to food issues. "It's unconscionable and unacceptable," he said.
He said that wheat - about 30% of the country's total grain reserves - could feed 210 million poor Indians for a year.
He calculated that the government has spent about 250m rupees (€4.1m) on the wheat it now leaves out in the rain.
"You're going to end up losing as much money on food grains that go bad than the subsidies would incur if they distributed it to the poor," he said. "It's completely irrational and illogical not to distribute it right away."
Siraj Hussain, the chairman of the Food Corporation of India, which manages distribution, declined to comment, saying he is banned from speaking to the media while Parliament is in session.
The impact does not stop at India's borders.
Global wheat supplies have been squeezed by drought and fires in Russia, heavy rains in Canada and locusts in Australia. Russia's decision this week to ban exports sent wheat prices to a two year high.
The 17.8 million tonnes of wheat, which is almost as much as France consumes in a year, and now beginning to spill from wet sacks in India is counted as part of global wheat stocks.
India is the world's second largest producer of rice and wheat, but it tightly controls exports. In 2007 it banned exports of wheat and non-basmati rice, except for humanitarian purposes.
If India decided to export its languishing stock - a politically unlikely scenario - it could help cool prices in a jittery global market.
