Anticipating a crash in the prices of kharif pulses and oilseeds below the minimum support price (MSP) in key growing states, the agriculture ministry has directed Nafed to commence procurement under the price support scheme (PSS) in Telangana, Karnataka, Rajasthan and Maharashtra. Besides, the nod for procurement of pulses and oilseeds in Gujarat is expected to be given shortly. Under the PSS, the government intervenes in the market to ensure that the farmers are paid MSP and overall prices do not fall below the MSP.
Sources told FE that pulses like urad and moong would be procured by Nafed in Telangana, Karnataka and Rajasthan, oilseeds like soyabean and groundnut would be purchased from Rajasthan and Maharashtra.
“The procurement of moong has commenced recently while rest of pulses and oilseeds would start arriving in mandis by November,” an agriculture ministry official said.
The agriculture ministry, so far, has approved purchase of 6 lakh tonne of oilseeds and pulses by Nafed under PSS. It is estimated that PSS procurement to the tune of Rs 5,000 crore could take place in kharif 2017-18 season. The agriculture ministry guarantees PSS procurement through banks, which provides the cash credit limit to procuring agencies.
This comes at a time when, according to the ministry, the country’s kharif foodgrain production (2017-18 season) is estimated to decline by close to 3% to 134.67 million tonne compared to last year, mainly because of patchy monsoon in parts of central India along with floods in parts of Rajasthan, Gujarat, Uttar Pradesh, Bihar and Assam.
The pulses output could drop to 8.71 million tonne, from the record 9.42 million tonne, mainly due to lower prices and patchy monsoon rains. Among different oilseeds, the output of soybeans is set for a dip of around 11.5% compared to last year.
Meanwhile, in anticipation of a bumper groundnut output, the Gujarat government has asked Nafed to purchase groundnut as its prices are ruling below the MSP of Rs 4,450 per quintal. The state is aiming at procuring 25% of the estimated 32.65 lakh tonne of groundnut output in the forthcoming kharif season, which begins in November.
“Due to good rains and crop coverage expectation of good production, market intervention will be required for ensuring MSP for farmers,” said Sanjay Prasad, principal secretary (agriculture), in a communication to the agriculture ministry. Gujarat also urged Nafed to purchase at least half of estimated 3.2 lakh tonne of arhar from the farmers in the state.