Storage and Transport

Issues and constraints 

• NAFED wasted over half of its onion buffer stock due to poor storage, at a time when government is importing tonnes of onion to keep prices at check.
• Central Institute of Post-Harvest Engineering and Technology (CIPHET), the annual harvest and post-harvest losses of major food grains ranges from 4.65 to 5.99% of total production.Post-harvest losses occur due to unscientific storage, insects, rodents, micro-organisms etc
• World Bank Report (1999), post-harvest losses in India amount to 12 to 16 million metric tons of food grains each year, an amount that could feed one-third of India's poor
• On an average, Indian farmers incur Rs 92,651 crore per year in post-harvest losses, the primary causes of which are poor storage and transportation facilities.
• Ashok Dalwai committee an investment of Rs 89,375 crore—a figure marginally lower than the annual post-harvest losses—is all it takes to improve the state of storage and transportation facilities for food crops
• food grain storage capacity is 88 million tonnes (MT) (covered – 75 MT lakh tonnes and Covered Area Plinth (CAP) – 13 MT) with FCI and State agencies.

Food Grain Storage and Management in India

• FCI nodal agency under Ministry of Consumer Affairs, Food and Public Distribution responsible for the procurement, storage and movement of food grains, public distribution and maintenance of buffer stocks.
• Storage plan of FCI to meet the storage requirement for holding stocks to meet the requirements of Public Distribution System and Other Welfare Schemes undertaken by the central government.
• FCI procures food grains at minimum support price (MSP) from farmers on an open ended basis (i.e., accepting all the grains that are sold to it by farmers), provided the food grains meet central government's uniform quality specifications
• procurement also by State Government Agencies (SGAs) and private rice millers on behalf of the FCI.
• All the procured food grains form the Central Pool.
• The grains are moved from the surplus states to the consuming states for distribution and for creation of buffer stocks and stored in FCI godowns for ensuring food security of the nation
• food grains are also disposed by FCI and State Governments through sale under Open Market Sales Scheme (OMSS) i.e., selling food grains at predetermined prices in the open market from time to time to enhance the supply of grains especially during the lean season and thereby to moderate the open market prices especially in the deficit regions.
• economic cost to FCI- acquisition cost at MSP, procurement incidentals (e.g. labour & transport charges, godown rentals) and distribution cost (freight, handling, storage & interest charges, losses during storage etc).
• Difference between Economic Cost and Central Issue Price (CIP) of food grains under various schemes (including National Food Security Act, 2013) is the operational loss to FCI and is reimbursed by Government as food subsidy.
• In India, food grains are stored using traditional structures by small farmers.
• The surplus grains are stored with government agencies like: Food Corporation of India (FCI), Central and State warehousing Corporations.  

Issues with Storage in India

• Improper storage management: stock stored remain in storage for more than its shelf life and such long storage, makes grains prone to rodents, moisture, birds and pests.
• The utilization of existing storage capacity less than 75% in majority of the months. Due to this, the storage space cannot be utilized for fresh arrivals of the ensuing season.
• Unscientific storage: About 80% handling and warehousing facilities are not mechanized and traditional manual methods for loading, unloading and handling of food grains and other commodities are used
• Gap in storage capacity with FCI: insufficient number of grain silos and covered godowns with adequate storage capacities. existing cold storage capacity is not integrated with other requirements. There is lack of supporting infrastructure such as integrated pack-houses, reefer trucks, ripening units etc.
• Issues with cold storage: unorganized and dominated by traditional cold storage facilities. distribution of cold storages is highly uneven with majority located in Uttar Pradesh, Gujarat, Punjab and Maharashtra.

Ashok Dalwai Committee on Improving Storage in India

• integrated agri-logistics systems to enable efficient transfer of value from farmgate to end-consumers will enlarge the share of produce that reaches markets
• district and state-wise storage plan to ensure efficient spatial distribution and modern warehouses and silos must be the preferred for new storage creation 
• Upgrading existing dry warehousing infrastructure to make them WDRA (Warehouse Development Regulation Authority) compliant and become eligible to issue eNWRs (electronic Negotiable Warehouse Receipts).
• Upgrading the existing godowns and warehouses
• Developing comprehensive guidelines/procedures to promote large number of accreditations and enable farmers to access warehousing facility in close proximity of their farm gate.
• Promotion of the system of warehousing and eNWRs: Advocate and popularise these help in using interest subvention based postharvest loans and buck the distress sale
• Increase accreditation of cold storage: to promote warehouse based post-harvest loans, in case of notified perishable commodities, substantively increase accreditation of cold storages
• Building aggregation units at village level: with transport links
• Promote self-help groups (SHGs) of the gatherers and provide them with a well-appointed place (drying yard, storage, primary processing support etc.)  

Storage management

What the Government is doing?

• Private Entrepreneurs Guarantee (PEG) Scheme, 2008 storage capacity is created by private parties, CWC and State Government Agencies for guaranteed hiring by FCI. After a godown is constructed and taken over by FCI, storage charges are paid to the investor for a guaranteed period of 9/10 years irrespective of the quantum of foodgrains stored
• central sector scheme in the North Eastern States along with Himachal Pradesh, Jharkhand and Kerala Funds by Government to FCI and directly to State Governments for construction of godowns
• Construction of Steel Silos: in Public Private Partnership (PPP) mode for modernizing storage infrastructure and improving shelf life of stored foodgrain
• Government guidelines
• Foodgrains in ‘Cover and Plinth’ (CAP) storage are to be stored on elevated plinths and wooden crates are to be used as dunnage material
• Stacks are to be properly covered with specifically fabricated low-density black polythene water -proof covers and tied with nylon ropes/nets
• regular monitoring mechanism under which inspections at all levels are carried out.
• Only covered rail wagons are to be used for movement of foodgrains
• creation of well-equipped scientific storage facilities to the farmers Under “Agricultural Marketing Infrastructure (AMI)”.
• Department of Atomic Energy (DAE) & Bhabha Atomic Research Centre (BARC) is engaged in extensive research on use of radiation processing for extending shelf life of food products.

Significance of storage

• storage of goods, from the time of production to the time of consumption, ensures continuous flow of goods in the market
• Protects the quality of perishable and semi-perishable products from deterioration.
• Helps in the stabilization of prices by adjusting demand and supply;
• Provides employment and income through price advantages
• Enables farmers to precondition, transport and store their produce, of their own volition, in safe and secure manner to markets of choice and at a time of choice.

Types of Storage in India

• Underground Storage Structures: dugout structures similar to a well with sides plastered with cowdung. These are safer from threats from various external sources of damage, such as theft, rain or wind.
• Surface storage structures: Bag storage and Bulk or loose storage
• For large scale storage
• CAP Storage (Cover and Plinth): commonly used which is economical but loss of grains is inevitable (vulnerable to wind damage). It is temporary storage method of storing crops in outdoor stacks of bagged grain, covered with a waterproof material
• Silos: grains in bulk are unloaded on the conveyor belts and, through mechanical operations, are carried to the storage structure. The storage capacity of each of these silos is around 25,000 tonnes.
• Warehousing: scientific storage structures especially constructed for the protection of the quantity and quality of stored products. Ex: Central warehousing corporation (CWC), State Warehousing Corporations (SWCs), Food corporation of India (FCI).