1. Bumper production makes maize prices crash under MSP in Punjab

Bumper production makes maize prices crash under MSP in Punjab

The mandi maize prices are presently ruling around `1,000 to `1,100 per quintal depending on the moisture content in the state while the Centre has declared MSP of `1,365 per quintal for the current crop year.

By: | Ludhiana | Published: July 13, 2017 3:42 AM
Punjab, Minimum Support Prices, MSP, Niti Aayog, mandi prices, maize, Punjab, Madhya Pradesh, Bihar, Rajasthan, Agricultural Produce Market Committee The mandi prices of maize in Punjab have fallen well below the Minimum Support Prices.

The mandi prices of maize in Punjab have fallen well below the Minimum Support Prices (MSP) in last few weeks mainly because of bumper production in the current crop year and heavy pre-monsoon showers, prompting the farmers to demand ‘price deficiency payment’ system recently mooted by Niti Aayog. The mandi maize prices are presently ruling around `1,000 to `1,100 per quintal depending on the moisture content in the state while the Centre has declared MSP of `1,365 per quintal for the current crop year (2016-17). However without any procurement by state or central agencies, farmers have been resorting to distress selling.

Kulbinder Singh Dollowal, a farmer from neighbouring district of Sangrur has just sold about 300 quintal of corn at around `1,000 per quintal at sprawling Khanna mandi to cattle feed manufacturers. However, he claims that the price realised barely matches the cost of production. “The government must intervene by purchasing the crop by paying us MSP,” Dollowal told FE.

Recently, the Aayog had suggested a new system where differences between MSP and market prices is paid to farmers in case mandi prices fall below MSP. The Aayog had also noted that excessive focus on cultivation of crops like wheat, rice and sugarcane in the key procuring states, including Punjab, because of MSP operations, has led to distortion of cropping patterns.

“Most of the maize coming into mandis at present have high moisture content besides the output has been much higher than last year,” Manjit Singh, Secretary, Agricultural Produce Market Committee (APMC), Khanna, also the largest mandi in Punjab, said. According to Punjab Mandi Board official if the government does not intervene in purchase operations for maize, farmers are expected to face huge monetary losses.

Despite the crash in price, maize is being promoted for encouraging crop diversification from common rice in the kharif season which would cater to poultry feed, silage and starch industries. Besides farmers grow maize in rabi season as well.

Maize is mostly sown in Punjab around March or April after rabi wheat or potato is harvested. According to third advance estimate of foodgrains released by agriculture ministry recently, the production of maize is estimated at a record 26.14 million tonne (MT) for 2016-17 crop year (July-June) against 22.57 MT reported in the previous year. Punjab, Madhya Pradesh, Bihar and Rajasthan are major producer of maize.

Meanwhile, top officials from Niti Aayog are visiting Punjab on Thursday to assess the issues concerning agriculture. “While the Aayog has mooted the concept of price deficiency payment, it should first start in Punjab,” a state mandi board official said.

The Aayog has suggested this approach as it would not require procurement of agricultural produce and thereby preventing accumulated of unwanted stocks. It has now suggested the introduction of the price deficiency payment system to remove this distortion in the MSP system.

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