As arrivals of rabi crops have picked up, their mandi prices have started showing a mixed trend.
Trade sources said the market prices of chana (gram), a vital pulse variety which has share of close to 50% in the country’s output, are ruling 7% above the minimum support price (MSP) of Rs 5440/quintal for the 2024-25 season due to fear of decline in output.
However, market prices of mustard, which has a share of more than 42% in the domestic production of oilseeds, are at present ruling 11% below the MSP of Rs 5650/quintal for 2023-24 season because of a surge in imports and prospect of a bumper output.
According to traders, wheat prices as per early trend in arrivals are ruling around MSP of Rs 2275/quintal. By early next month, harvesting of key rabi crops is expected to be completed and arrival would peak.
The arrival of newly harvested wheat has commenced in Rajasthan and Madhya Pradesh, where the state government has announced a bonus of Rs 125/quintal over MSP. Arrivals in Punjab and Haryana would commence from early April.
Chana output is estimated at 12.16 million tonne (MT) in 2023-24 crop year (July-June), lower than 12.26 MT in 2022-23 crop year.
“Seeding for chana was lower this year compared to last year and this could potentially impact the overall supply and prices in the market,” Harsha Rai , head, Mayur Global Corporation, leading pulses trading firm, told FE. Rai said chana prices are likely to remain stable and trade at current levels for the next few months.
The government agencies are likely to commence chana procurement operations from April 1 to build up a buffer which has currently plummeted to around 0.9 MT against the norm of 1 MT.
With the projection of a bumper harvest of 12.69 MT in 2023-24 crop year and higher imports of edible oils has impacted domestic mandi prices of mustard seed.
While harvesting is currently in the full swing in key producing states, mandi prices of mustard seed, at Bharatpur (Rajasthan), the hub of the country’ trade was ruling around average price of Rs 5000-5100/quintal on Thursday against a MSP of Rs 5650/quintal for 2023-2024 season.
Roop Singh, CEO, Uttan Mustard Producers Company, a FPO based in Bharatpur, the hub of the trade, said that while in 2020 and 2021 the farmers have received remunerative prices which was reasonably above the MSP, prices have been ruling below MSP since last year as there has been increase in imports of edible oil as global prices have soften and the government has slashed import duties.
Currently farmers registration for MSP purchase of mustard by government agencies are on and purchase is likely to commence from April 1. Retail inflation in mustard oil in February, 2024 declined by 18.14% on year.
The retail inflation in pulses category last month rose to 18.9% last month on year, while chana prices reported a price rise of 13.93% last month.
Inflation in wheat declined further to only 2% in February from 12% in July,2023 on year because of improvement in supplies due to open market sale being carried out by the Food Corporation of India.
