Despite low arrivals, mandi prices of rabi crops up to 15% below MSPs

Published: April 29, 2020 6:15 AM

On the other hand, the Centre’s nodal agency Nafed (for oilseeds and pulses) has purchased 72,416 tonne of chana, which is less than 3% of the sanctioned quantity under PM-Aasha scheme.

The situation will not be managed if the lockdown is extended when comparatively large farmers are called to the centres, he said. The situation will not be managed if the lockdown is extended when comparatively large farmers are called to the centres, he said.

By Prabhudatta Mishra

Average prices of four out of five major rabi crops — wheat, chana, mustard and barley — were up to 15% below their minimum support prices (MSPs) in the past month. In states where the mandi arrivals are higher, the prices of these crops were lower than the all-India average rates.

The prices remained subdued even as gross market arrivals of these four crops are only about 25-30% of the year-ago levels. Many mandis across the country were opened for trading nearly a fortnight ago. The low demand due to the Covid-19 pandemic is believed to be the reason for the price slump. Also, sections of traders are still not operating.

The all-India weighted average mandi price of wheat was Rs 1,908/quintal, down by 1% from its MSP during April 1-27 while it was Rs 1,864 and Rs 1,844 in Madhya Pradesh and Rajasthan, respectively. Since Punjab and Haryana have assured farmers to buy the entire wheat crop under MSP operations for the central pool, the mandi prices were ruling at MSP level – Rs 1,925/quintal – in these states.

“The procurement system in Madhya Pradesh is faulty and made the entire process slow. The government is not able to ensure that all the farmers called to the purchase centres turn up on the scheduled date. They should verify if an SMS actually reaching them in time,” said Sunilam, a farmer leader. The situation will not be managed if the lockdown is extended when comparatively large farmers are called to the centres, he said. Currently only small and marginal farmers having less than two hectare of land are called to the purchase centres in Madhya Pradesh.

Madhya Pradesh, where the wheat harvesting has been completed in 99% of the planted area, has been very slow in official procurement of wheat due to enforcement of social distancing. A total of 1.9 million tonne of wheat has been procured until April 27 against a target of 10 million tonne while Punjab has purchased 5.5 million tonne out of 13.5-million tonne target. The official procurement started from April 15 in both the states.

The Food Corporation of India has procured 10.24 million tonne of wheat so far, which is 25% of the target.

On the other hand, the Centre’s nodal agency Nafed (for oilseeds and pulses) has purchased 72,416 tonne of chana, which is less than 3% of the sanctioned quantity under PM-Aasha scheme. The procurement of mustard, the key rabi-grown oilseed, at 0.18 million tonne is nearly 10% of the targeted purchase.

The weighted average mandi prices of chana and mustard were 15.4% and 12.6% below their respective MSPs in the review period of April 1-27 (see chart).

Considering the arrivals of both these crops at 0.25 million tonne as reported by mandis during the review period, farmers have lost nearly Rs 160 crore due to lack of effective implementation of the PM-Aasha scheme as they were forced to sell at lower rates in the open market. Only masur crop is selling above its MSP in all the states.

“To ensure MSP for farmers, the government has to ensure the auction in mandis start from MSP level and designate the village level primary agricultural cooperative society as permanent procurement centres,” said Rampal Jat, a farmer leader of Rajasthan, which is the top producer of mustard and barley.

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