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Photo: iStock
Photo: iStock

Kharif crops sell at lower than govt promised MSP

  • A slide in wholesale price on the back of a record harvest may prompt farmer unions to intensify their protests

NEW DELHI : At a time when farmers are protesting a new set of laws they fear may weaken the minimum support price (MSP) regime, many freshly harvested Kharif crops are selling at less than government promised support prices. With a record harvest on the cards, a slide in crop prices may prompt farmer organisations to hold the centre accountable on its promise to honour MSPs, fueling protests in states beyond Punjab and Haryana.

Freshly harvested crops like cotton and soybean are currently selling at less than support prices in some states. For instance, cotton is selling at rates between 3,900 and 4,700 per quintal in Gujarat compared to the promised MSP of 5,515 per quintal. Similarly, soybean which has started arriving in mandis in Madhya Pradesh is selling at around 3500 per quintal, lower than the announced MSP of 3,880 per quintal.

Farmers in Punjab are selling Basmati paddy at less than 2,000 per quintal, compared to wholesale prices around 2,500- 2,700 per quintal last year. Basmati is largely exported and the government does not announce support prices for this premium variety of paddy.

“Farmers have delayed their harvest due to the ongoing agitation and also because prices are low," said Harjit Ravi, a farmer leader from Tarn Taran in Punjab. Ravi added that in Hoshiarpur and Jalandhar fresh harvests of maize is selling for a pittance, at 800-900 per quintal, less than half of the announced MSP of 1,850 per quintal.

The trend in prices of Kharif crops will be clearer over the next month as arrivals peak in wholesale markets. A record harvest is likely to dampen wholesale prices.

Currently farmers in Punjab and Haryana are protesting a new set of laws which they fear would weaken the existing regulated markets by allowing barrier free participation of private players. Farmers are apprehensive of the new trade regime which they feel will expose them to market forces, eventually leading to lower procurement at support prices.

To allay fears, the centre has repeatedly assured that MSP procurement operations will continue. On Monday, the government also announced support prices for the upcoming winter crop season ahead of schedule, in a bid to pacify protestors. Wheat prices were raised by 50 per quintal to 1975 per quintal, a 2.6% increase over the previous year’s MSP. The hike of 50 paisa per kg is the lowest in 11 years.

Farmers who had stored wheat harvested in April-May expecting better prices have been hit as well. Currently, farmers in Madhya Pradesh are selling wheat at prices between 1500-1700 per quintal, compared to last season’s MSP of 1,925 per quintal.

“We were hoping that wheat MSP will be raised to at least 2,000 per quintal to account for the rising costs of cultivation including on diesel, but the meagre hike has disappointed us," said Abhishek Raghuvanshi, a farmer from Vidisha in Madhya Pradesh.

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