Paddy arrivals rise over bonus announcement

Written by Commodities Bureau | New Delhi, Oct 22 | Updated: Oct 23 2008, 05:47am hrs
Paddy arrivals across India is slowly picking up after the government announced a Rs 50 per quintal bonus over the minimum support price (MSP), but it is still around 8,00,000 tonne less than the same period last year.

According to official data, paddy arrivals in India touched 9.4 million tonne on Wednesday, while it was around 10.2 million tonne during the same period last year. However, procurement has increased after the bonus announcement and was pegged at 5.61 million tonne as on October 22, up from 5.32 million tonne during the same period last year.

Last week, the government hiked the paddy MSP by Rs 50 per quintal to Rs 900 per quintal for common grade and Rs 930/100 kg for grade A paddy.

Official sources said that the government was compelled to announce the bonus on MSP after both procurement and arrivals slowed down because farmers held on to their stocks.

In June, the government announced an interim MSP of Rs 850 per quintal for common grade paddy and Rs 880 per quintal for grade A paddy. It referred the matter to the Prime Minister Economic Advisory Council for a final decision because of disagreement between states. The EAC opined that MSP should be maintained at Rs 850 per quintal for the time being and an additional bonus be announced when the government starts its annual paddy procurement. India is expected to produce 83.25 million tonne of rice in the current kharif season, up from an estimate of 82.81 million tonne.