Covid-19 update: Hoarding, transport snags choke supply of essentials

Part of the problem is also that modern supply chains are intricate — they span whole sectors. A bread maker typically depends on three: agriculture, biological and chemical leavening agent producers and the packaging sector, each with its own supply chain.

A supply crunch of consumer items has cascaded across states, as buyers, rich and poor, scour markets for everyday needs amidst a sweeping lockdown to stop the spread of the coronavirus disease (Covid-19).

A milk vendor rides his bicycle on a deserted road in Delhi.(Burhaan Kinu/HT PHOTO)

Businesses blame their lean inventories on panic-buying of goods equivalent to two-three months of household supplies by affluent classes, as they hunkered down for an indefinite shutdown.

They also blame issues with the transportation of food supplies, including grains, edible oil, fruits, vegetables, milk, even consumer products. Some stores are rationing supplies, selling limited quantities of items to discourage hoarding.

Click here for the complete coverage of the Covid-19 pandemic

“The excess buying has strained back-end stocks and godowns,” said market tracker Comtrade in a note. Inventories that should have lasted two months were exhausted within a week, it said.

And deliveries at the last-mile are hobbling under tight local rules of individual states.

Federal instructions and orders issued by state administrations are not in tandem, first-hand reports suggest. India is one economy but many individual markets. Steering all of them in one direction, all of sudden, has been a key challenge, ground reports indicate.

Part of the problem is also that modern supply chains are intricate — they span whole sectors. A bread maker typically depends on three: agriculture, biological and chemical leavening agent producers and the packaging sector, each with its own supply chain.

“There have been no biscuits in any store for three days,” Alka Aggarwal, a housewife said, pointing to her neighbourhood Samachar market in east Delhi.

A soaring milk demand ahead of the lockdown followed by a sharp fall now had upset supply schedules, RS Sodhi, the managing director of Amul, India’s largest dairy cooperative, said . Small milk suppliers and aggregators were under pressure but the overall availability is adequate, he added .

Some states have seen milk demand drop, leading to farm losses. “Owing to regulatory measures in the wake of Covid-19, there is a decline in demand of milk and milk products, and difficulties have also arisen in interstate movement for its conversion to milk powder,” Rajesh Kumar Singh, additional chief secretary of Kerala admitted .

Government may borrow Rs 40k crore as cash-strapped states seek funds

Hundreds of trucks are stuck on state borders, despite the home ministry’s orders allowing movement of both essentials and non-essentials. Truckers have sought government intervention to smoothen interstate movement.

“The home ministry’s orders have not percolated to the ground level even though operators want their vehicles to move. Trucks are still being stopped at various state borders in states such as Delhi, UP and Haryana for example,” Kultaran Singh Atwal, president of the lobby group All-India Motor Transport Congress said.

The Food Corporation of India is ramping up supplies.

“During the lockdown, the Food Corporation of India is replenishing 10 lakh (1 million) tonne of foodgrains through 352 rakes of Indian railways,” Union food minister Ram Vilas Paswan said in a tweet.

But there is a problem. It only stocks cereals (rice and wheat), and limited quantities of pulses and sugar. The crisis is concentrated in a clutch of other necessary items: flour, biscuits, edible oil, soaps, handwash, some varieties of lentils, vegetables, baby food, packaged juices, medicines for a variety of conditions, even matchboxes.

“Earlier, wholesalers would deliver to my shop. Now, I have to make beeline to the wholesaler, taking several hours,” general provisions store proprietor Ravindra Ghosh said from Ranchi’s Kokar locality.

To resolve logistics issues, the Union government has formed a committee under the ministry of home affairs. The committee on logistics comprises secretaries to the ministries of aviation, health, drugs, textiles, consumer affairs and shipping, apart from the railway board chairman. The committee is tasked with ensuring unhindered supply of essential and medical goods.

On the ground, however, broken chains of command are testing the limits of ensuring a billion people’s essential needs are met. The country went into a lockdown with less than four hours of notice.

Police crackdown on agricultural activities has upended harvesting and transportation of crops. Md. Moinuddin, a vegetable wholesaler in Assam’s Kamrup rural district outlying Guwahati, said he had not been able to hire trucks to get stocks into the Assam city after police seized some trucks plying without permits.

Cultivators are piling perishables in cold chains, as buyers aren’t purchasing in large quantities, unsure of transport.

Farmers in Haryana’s Babain near Kurukshetra town said aggregators weren’t willing to take risks. “I have stocked about 12 quintals (100 kg each) potatoes in cold storages. No more cold storages space is available in entire Kurukshetra,” Jagtar Singh, a farmer, said.

Truckers have sought extension of the due date for payment of road tax and GST to September 30. “On the 8th day of the countrywide lockdown, the government is making frantic efforts to restore supply chains. There is no clear policy on whether to run vehicles or not, especially those with non-essential goods,” Singh said.

There is no staff, no labour, no traders and factories as well as workshops are shut, Singh added. Drivers have no facilities for eating or basic shelter. “Transportation services cannot work in isolation,” the truck lobby president said.

Three major wholesale hubs run by state-regulated agriculture produce market committees – Lasalgaon in Maharashtra, Mullana near Haryana’s Ambala and Gollapally in Telangana’s Karimnagar -- said they were operating with 30-40% less staff.

In this vacuum, Indian Railways has stepped up.

A railway ministry official said issues at many terminal points, loading and unloading operations were being resolved now. There are issues of shortage of labour, he said. As many as 1,43,458 wagons of essential goods were loaded over the past three days including 7,195 wagons of food grains, 64,567 wagons of coal, 3,314 wagons of steel and 3,838 wagons of petroleum. Special focus is being given to essential commodities like foodgrains, sugar, salt, fruits & vegetables, coal, petroleum products and fertilisers.

Scheduled passenger flights have also been pressed into service to supply cargo nationwide. Over the past few days, 85 flights have carried 76 tonne. All passenger flights are grounded till April 14.

“We are operating flights despite significant logistical challenges in road transportation of cargo to and from airports and in the movement of aviation personnel,” a ministry of civil aviation official said.

“Bulk of the air cargo comprises low-weight-high-volume products such as masks, gloves and other consumables that require more cargo space per tonnage of material. Special permission has been granted to store cargo in the passenger seating area, with due care and precautions,” the aviation ministry official added. India is also deploying private airlines for supplies. Private carriers such as IndiGo, SpiceJet and Blue Dart are also operating cargo flights on a commercial basis.

“This is like a mass synchronisation game. It needs practice to get it right,” said Rahul Digmbar, a former senior manager (operations) of BlueDart.