Centre has decided to extend kharif MSP operations beyond March 15, the date on which the operations were to be wound up. (Source: Reuters)
With the mandi prices of tur (arhar) ruling below the minimum support price (MSP) of R5,050 per quintal in key producing states of Madhya Pradesh, Maharashtra, Telangana and Karnataka, the Centre has decided to extend kharif MSP operations beyond March 15, the date on which the operations were to be wound up. Sources told FE that following a high-level meeting, it has been decided that farmers’ cooperative Nafed, which has been carrying out procurement of kharif arhar for building pulses buffer stocks along with Food Corporation of India (FCI) and SFAC, will continue with its procurement operations for arhar, a key pulse variety that is generally expensive, till the further instructions.
“States must ensure that the arhar should not be sold below MSP inside the designated mandis. After we intervened by purchasing quality arhar from the farmers, the mandi prices of this item and other pulses have been stabilised around the MSP across mandis,” Sanjeev Kumar Chadha, managing director of Nafed, told FE. Besides, the Maharashtra government has instructed the agencies to cancel contracts of those agents in the mandis who try to purchase pulses from farmers below MSP.
So far, Nafed, SFAC and FCI have purchased close to 5 lakh tonne of arhar against the target of 6 lakh tonne for the current season. Along with other pulses like kharif moon and urad, the three designated agencies have purchase close to a million tonne of pulses for buffer stocks.
Official sources also stated that the cabinet secretariat has decided to put curb on import of pulses for building a buffer stock of two million tonne in anticipation of bumper rabi crops.
According to the second advance estimate of crop production for 2016-17 released recently by agriculture ministry, the production of arhar is expected to be at an all-time high of 4.23 million tonne (mt), against the output of 2.56 mt in 2015-16. The overalls pulses output in crop year 2016-17 is expected to witness an increase of more than 35% to 22.14 mt compared to last year’s output.
Meanwhile, the retail price of arhar has seen a sharp decline in the past four months. As per the department of consumer affairs data, the retails prices of arhar in Delhi is ruling around R89 per kg against R120 per kg prevailed on October 1, 2016.
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The current situation is in sharp contrast to what was prevailing a year ago when the prices, especially tur prices, skyrocketed, forcing the government to step up imports and announced the abolition of import duties and creation of buffer stocks. With the Centre jittery over possible distress sales by farmers in many locations, it has also asked state governments to supplement procurement of arhar.