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Maharashtra steps in to buy tur at MSP even as centre refuses to extend deadline

LiveMint logoLiveMint 25-04-2017 Abhiram Ghadyalpatil

Mumbai: Despite a five-fold increase in tur dal (pigeon pea) production, farmers in Maharashtra are being forced to sell their produce to private traders at prices lower than the government’s minimum support price (MSP) as procurement centres have downed shutters after the Union government’s deadline for procuring tur ended on 22 April.

Union minister for food and consumer affairs Ram Vilas Paswan told Maharashtra chief minister Devendra Fadnavis on Monday that the procurement deadline would not be extended.

Fadnavis, however, told reporters on Tuesday that the designated state government agencies would procure the tur stocks that had already been registered at the procurement centres by 22 April.

Fadnavis said the state would make a provision of Rs1,000 crore to buy this stock at the minimum support price of Rs5,050 per quintal.

According to the third estimate of Maharashtra’s agriculture commissionerate, the state is estimated to produce 2.35 million tonnes of tur dal in 2016-17. The state’s economic survey for 2016-17, however, estimated 1.17 million tonnes of tur yield on the basis of initial estimates of the commissionerate.

In Vidarbha and Marathwada, the two regions that define Maharashtra’s agrarian crisis and account for more than 80% of the state’s tur production, farmers have been forced to sell their crops to private buyers and traders, officials who operated the procurement centres and Agriculture Produce Marketing Committee (APMC) functionaries said.

According to the marketing department, 10 lakh quintals (100,000 tonnes) of tur is lying unsold at the APMC markets which the government agencies use for procurement.

Sudhir Kothari, president of Hinganghat APMC in Vidarbha, said farmers were now forced to sell to traders at Rs4,100-4,200 per quintal. “This is a direct loss of Rs1,000 per quintal. Why should the government announce deadlines for procurement when it has already fixed MSP and assured to buy the produce at MSP if farmers are getting a lower price in private market?”

“At the Hinganghat APMC, the government has procured only 15% of the 300,000 quintals of tur that arrived, leaving the remaining 85% stock for private procurement. In my estimate, there is still 40% of tur in Maharashtra which needs to procured,” Kothari said.

Why did procurement suffer? There are two reasons: One, a lot of the produce did not match the standards set by the government to be eligible for MSP. Two, since farmers cannot hold the stock for long, they sell to private buyers at lower prices as they need the money ahead of the kharif sowing that begins in June.

On the recommendation of the Commission for Agriculture Costs and Prices (CACP), the central government fixed the MSP of tur at Rs5,050 per quintal for 2016-17, 9.2% more than the previous year. Both the centre and the state government had appealed to the state’s farmers to shift to pulses from cash crops such as sugar cane and cotton, under the “per drop, more crop” policy and also to reduce the tur import bill.

The appeals worked, and the area under tur cultivation in the state rose from 1.23 million hectares in 2015-16 to 1.53 million hectares in 2016-17. Meanwhile, the area under cotton shrank from 4.2 million hectares to 3.8 million hectares and that under sugar cane from 9.87 lakh hectares to 6.34 lakh hectares. Tur yield ballooned, from 4.44 lakh tonnes in 2015-16 to 2.35 million tonnes in 2016-17.

Backed by the centre’s promise to procure tur at MSP if prices in the private market declined, the state government announced at the start of the procurement season earlier this year that it would operate procurement centres as long as farmers wanted to sell. The government then designated Maharashtra Marketing Federation, Vidarbha Marketing Federation, Maharashtra Farmers’ Producer Company Ltd, and Tribal Development Corporation as the nodal agencies to procure Tur. The centre designated National Agriculture Federation (Nafed) as its procurement agency in Maharashtra. All these agencies have together purchased 3.99 lakh tonnes of Tur.

At a meeting in Delhi on Monday, Paswan refused to extend the deadline, saying “farmers were not getting the produce to mandis now and it was traders who were importing at a cheaper rate and selling to us at MSP”. Paswan also said his ministry was in favour of raising the import duty on tur from 10% to 25% to stop traders from importing cheap pulses.

Fadnavis said the centre had expressed this “concern that traders and not farmers could be selling tur at procurement centres”. “We are buying tur which is lying at the procurement centres and which is listed for procurement. But we will also carry out random checks to find out if traders are selling stock instead of farmers. We will also use satellite surveys of cultivation to find this out,” Fadnavis said.

Nationalist Congress Party (NCP) leader Dhananjay Munde said the government had not bought even 1% of the total tur yield. “After making appeals to farmers to grow more tur, the centre and the state completely failed to put in place a proper procurement plan. The government needs to restart procurement and provide a bonus of Rs500 per quintal over the MSP as compensation,” Munde said. Maharashtra Congress president Ashok Chavan said the government had “betrayed the farmers by shutting down procurement centres” even though it had promised to buy all tur stocks at MSP.

Fadnavis, however, said the tur stock procured by the government was a record in Maharashtra. “Across the country, around 1.1 million tonnes of tur has been procured by the government agencies. Maharashtra alone accounts for 40% of this procurement and our share will go up to 45% after we have procured the remaining stock at centres. This is a record high procurement and no other state has bought this much of Tur. In 2011-12, under a similar scheme implemented by the Congress-NCP government, Nafed procured only 20,000 tonnes of Tur and stopped procurement on 15 March. Our government has procured 2,500% more tur and gave three extensions after March 15,” Fadnavis said.

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