Buffer stocks are reserves of essential commodities, aimed at stabilizing agricultural prices and ensuring food security. India currently maintains over 80 million tonnes of buffer stock, well above the norm set by the Buffer Stocking Policy (around 30-40 million tonnes), managed primarily by the Food Corporation of India (FCI). 

Importance of buffer stocks for stabilizing agricultural prices:

1. Mitigating Price Volatility: According to the RBI Report, despite adverse climatic conditions and international disruptions, buffer stocks helped contain food inflation at average of 5.9%.
2. Mitigating Global Supply Disruption (2022-23): Even during the Russia-Ukraine war, buffer stocks helped stabilize the market by releasing 18 lakh tonnes of wheat in early 2023.
3. Stabilizing Farmers’ Incomes: In 2021-22, FCI procured 43 million tonnes of wheat and 58 million tonnes of rice, stabilizing farmer incomes during surplus production.
4. Public Distribution System (PDS): Buffer stocks support the National Food Security Act (NFSA), ensuring food supply to 67% of India’s population at subsidized rates, and controlling inflation for essential goods.
5. Export Management: In times of surplus, the government can release surplus grains for export. Conversely, during shortages, restricting exports ensures price stabilization.
6. Meeting Emergency Needs – Buffer stocks help meet food requirements during natural calamities or crises. Eg- Garib Kalyan Yojana during COVID

Challenges Associated with Storage of Buffer Stocks:

1. Wastage and Quality Degradation: As per Ministry of Consumer Affairs, more than 25000 Metric Tonnes (MT) of food grains were wasted in the last five years in FCI godowns.
2. Excess Procurement:  In 2020-2021, India held about 90 million metric tons of food grains particularly due to the open procurement policy, far exceeding the buffer norms.
3. Management and Leakages:  Shanta Kumar Committee highlighted that 46% of PDS grains do not reach the intended beneficiaries due to inefficiencies and corruption.
4. Mismatch Between Procurement and Regional Needs:  Procurement is concentrated in states like Punjab, Haryana, and UP, whereas Bihar and West Bengal often face shortages.
5. Inadequate Storage Infrastructure and obsolete technology: Using temporary facilities like Covered and Plinth (CAP), lacking modern technology for temperature control, pest management, and moisture regulation.    
6. Financial burden on the government due to high costs of procurement, storage, and management, especially during years of large-scale purchases, straining the budget.

Recommendations to revamp storage of buffer stocks:

1. Ashok Gulati Committee (2011): revision of buffer stock norms based on actual requirements for the PDS and emergency situations.
2. Comptroller and Auditor General (CAG) Report on FCI (2013): use of Technology to digitize inventory management systems, allowing real-time tracking of food stocks at FCI warehouses.
3. Shanta Kumar Committee (2015): It suggested decentralizing the procurement process by encouraging states to take up procurement based on their regional capabilities. 

India’s “World’s Largest Grain Storage Plan” aims to create 70 million tons of modern storage through cooperatives, enhancing rural capacity, improving grain handling, and reducing post-harvest losses by building silos and warehouses in underserved areas.