Private firm commences rice procurement in Jharkhand

By: | Published: January 12, 2016 12:14 AM

The Food Corporation of India (FCI) has awarded contracts to two private players — National Collateral Management Services...

The Food Corporation of India (FCI) has awarded contracts to two private players — National Collateral Management Services (NCML) and Veerprabhu —to carry out paddy purchase operations in Jharkhand and Uttar Pradesh, respectively.

This is for the first time that private players have been allowed to purchase paddy from farmers on behalf of FCI on a bigger scale. Last year, the Centre had decided to engage private players during the current kharif season for procurement of rice in eastern Uttar Pradesh, Jharkhand, West Bengal, and Assam. These are states where the procurement mechanism of FCI and state government agencies are rather poor.

Sources told FE that NCML has commenced paddy purchase in three  identified clusters in Jharkhand. The Mumbai-based grain trading firm, Veerprabhu, has been allowed to purchase paddy from clusters in eastern Uttar Pradesh. “We are at present not looking at huge volume of procurement by private parties. However, we are expecting the private sector to bring in efficiency in grain purchase system,” a food ministry official said.

The FCI has allowed private firms in only those clusters where there is possibility of procurement of one lakh tonne of rice equivalent of paddy. Besides, the new policy allows the private parties to open as many purchase centres as possible in the allotted cluster, subject to a cluster covering a minimum 500 to 1,000 hectare.

The corporation has also shortlisted Veerprabhu to commence paddy procurement operations in West Bengal.

As per the policy, the private parties would be engaged in procurement of paddy in a cluster identified by the respective state government and the private company would deliver custom milled rice (CMR) at the FCI or state government-owned agency godowns.

The food ministry has set a target to procure 30 million tonne (MT) of rice during the kharif marketing season (2015-16) starting from October 1. Till Monday, the rice procurement by agencies have already crossed 20 million tonne which is 30% higher compared to purchase during same period of 2014-15 marketing year (October -September).

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