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HomePosts Tagged "minimum support price (MSP)"
AgroPolicy, Fruits, Pulses, Trade, Vegetables

Procurement limit of crops under MIS increased from 20 per cent to 25 per cent

Market Intervention Scheme (MIS) is a component of PM-AASHA scheme. Market Intervention Scheme (MIS) is implemented on the request of State/UT Government for procurement of various perishable agricultural/horticultural commodities such as tomato, onion and potato etc. for which Minimum Support Price (MSP) is not applicable and there is a reduction of at least 10% in the market prices in the States/UTs as compared to the rates of the previous normal season, so that farmers are not forced to sell their produce under distress.

To encourage more States for implementation of MIS, Government has revised the MIS Guidelines in the following provisions: Made MIS a component of the integrated scheme of PM-AASHA, MIS will be implemented only when there is a minimum reduction of 10 per cent in the prevailing market price as compared to the previous normal year.

The procurement/coverage limit of production quantity of crops has been increased from the existing 20 per cent ​​to 25 per cent. The State has also been given the option to pay the difference between the Market Intervention Price (MIP) and the selling price directly into the bank account of the farmers in place of physical procurement.

Further, where there is a difference in the price of TOP crops (tomato, onion and potato) between the producing and consuming States, the operational cost incurred in storage and transportation of crops from the producing State to other consuming States will be reimbursed by Central Nodal Agencies (CNA) like NAFED and NCCF, in the interest of farmers. Approval has been given to NCCF for reimbursement of cost for transportation of Kharif tomato upto 1,000 MT from Madhya Pradesh to Delhi. It is being proposed to include, apart from NAFED and NCCF, Farmer Producer Organizations (FPOs), Farmer Producer Companies (FPCs), State nominated agencies and other Central Nodal Agencies, to undertake procurement of top crops under MIS and to make arrangements for storage and transportation from the producing state to the consuming State in case of price difference between the producing State and the consuming State, in coordination with the implementing state.

    Procurement limit of crops under MIS increased

    AgroPolicy, Allied Industry, Finance, Schemes - Govt, Sugar industry

    The government of Uttar Pradesh is considering raising the price of sugarcane this year. The state’s Advisory Committee has given its approval for a potential increase, which is likely to be between Rs 10 and Rs 15 per quintal. A definitive conclusion on this matter will be reached shortly by the state cabinet, as reported by Navbharat Times

    In January 2024, the Uttar Pradesh government increased the State Advisory Price (SAP) for all types of sugarcane by Rs 20 per quintal. The SAP for early maturing varieties rose from Rs 350 to Rs 370 per quintal, for common varieties from Rs 340 to Rs 360, and for late maturing varieties from Rs 335 to Rs 355 per quintal.

    Farmer groups have shown frustration with the relatively modest price increases over the past few years. Although the government raised the price by Rs 20 per quintal for the 2023-24 period, farmers contend that such increments are inadequate and should be implemented each year to reflect growing production expenses.

    Conversely, sugar mill operators have opposed any price increases. They claim that despite making regular payments and running their mills for the entire season, this year has seen a lower recovery rate of sugar from the cane. Mill owners caution that rising costs could hinder their ability to make prompt payments and emphasize that sustaining mill operations under these conditions will become progressively more difficult.

    Recently, as the anticipated rise in the State Advised Price (SAP) for the 2024-25 season approaches, the UP Sugar Mills Association (UPSMA) has voiced worries about a decrease in sugar recovery, which will result in higher production expenses. In a letter addressed to UP Chief Secretary Manoj Kumar Singh, the association pointed out the reduction in recovery. The decline in sugar recovery compared to last year has risen notably to around 0.84%, which has considerably increased production costs.

    Mill operators are also appealing to the government to raise the Minimum Support Price (MSP) for sugar. The MSP for sugar, maintained at Rs 31 per kg since February 2019, has not been adjusted. Nonetheless, industry organizations have requested a hike due to escalating production expenses and the financial strain on sugar mills.

    The government of Uttar Pradesh is considering

    Acts & Schemes – Centre, Agribusiness, India, Trade

    Haryana becomes the first state in the nation to purchase 24 crops at the minimum support price (MSP) , said Agriculture and Farmers’ Welfare Minister Shyam Singh Rana, while attending Kisan Diwas celebration at Chaudhary Charan Singh Haryana Agricultural University (HAU)

    Speaking at Kisan Diwas, Minister Rana greeted the farming community and thanked Chief Minister Nayab Singh Saini for his leadership in releasing the announcement that ensures MSP procurement for all 24 of the state’s crops. According to him, it is a revolutionary move for the farmers in the state.

    According to the government, the ruling is intended to guarantee farmers receive fair rates for their produce. Ten other crops, including Ragi, Soybean, Nigerseed, Safflower, Barley, Maize, Jowar, Jute, Copra, and Summer Moong, are purchased by government agencies on the MSP in accordance with the notification.

    Important food and cash crops like paddy, bajra, kharif moong, urd, arhar, til, cotton, groundnut, wheat, mustard, gram, masur, sunflower, and sugarcane will now be included in the list of 14 crops already purchased at MSP.

    All of the notified crops are guaranteed to be purchased at the government-announced MSP since the notification complies with the Central government’s MSP policy. Furthermore, the state government will continue to purchase sugarcane at a Fair and Remunerative Price (FRP) of Rs 400 per quintal. However, farmers who have registered on the Meri Fasal Mera Bayora site will be able to sell their produce on MSP, according to state agriculture department officials.

    Chief Minister Nayab Saini stated, “The state government has guaranteed to procure 100 per cent of all farmers’ crops, so the decision was taken in the interest of the state’s farmers.”

    Haryana Agriculture and Farmers Welfare Minister Shyam Singh Rana greeted farmers on the occasion of National Farmers’ Day, stating that Haryana is now the only state in the nation to purchase all 24 notified crops at the MSP set by the union government.

    The action also has significant political ramifications because farmers in Punjab, a nearby state, were demonstrating against the union government and calling for legislation to ensure MSP. The state governments can also guarantee the purchase of all crops on MSP, according to the Haryana government’s decision.

    Haryana becomes the first state in the

    AgroPolicy, Foodgrains, India, Oilseeds, Pulses

    The absolute highest increase in MSP has been announced for Rapeseed & Mustard at Rs 300 per quintal followed by Lentil (Masur) at Rs 275 per quintal.

    The Cabinet Committee on Economic Affairs (CCEA) chaired by the Prime Minister Narendra Modi, has approved the increase in the Minimum Support Prices (MSP) for all mandated Rabi Crops for Marketing Season 2025-26.

    Government has increased the MSP of Rabi Crops for Marketing Season 2025-26, to ensure remunerative prices to the growers for their produce. The absolute highest increase in MSP has been announced for Rapeseed & Mustard at Rs.300 per quintal followed by Lentil (Masur) at Rs.275 per quintal. For gram, wheat, safflower and barley, there is an increase of Rs.210 per quintal, Rs.150 per quintal, Rs.140 per quintal and Rs.130 per quintal respectively.

    The increase in MSP for mandated Rabi Crops for Marketing Season 2025-26 is in line with the Union Budget 2018-19 announcement of fixing the MSP at a level of at least 1.5 times of the All-India weighted average Cost of Production. The expected margin over All-India weighted average cost of production is 105 percent for wheat, followed by 98 percent for rapeseed & mustard; 89 per cent for lentil; 60 per cent for gram; 60 percent for barley; and 50 percent for safflower. This increased MSP of rabi crops will ensure remunerative prices to the farmers and incentivise crop diversification.

    The absolute highest increase in MSP has

    AgroPolicy, India, Interaction

    In an interaction with AgroSpectrum India, Vijay Sardana, a renowned techno-legal advisor on agribusinesses, explains the key dimensions of agriculture along with the action points that such committees should undertake. Edited excerpts.

    Post the repeal of the farm laws last year, the centre was tasked with the forming of a committee to give suggestions on making minimum support price (MSP) more effective, giving more autonomy to the Commission for Agricultural Costs and Prices (CACP) and to suggest measures to strengthen the agricultural marketing system. The committee had its first meeting in August and created sub-groups to examine the important issues hindering the business of agriculture. In an interaction with AgroSpectrum India, Vijay Sardana, a renowned techno-legal advisor on agribusinesses, explains the key dimensions of agriculture along with the action points that such committees should undertake. Edited excerpts.

    Can you brief us about how MSP works and the role played by the government for its effective functioning?

    There are a lot of issues surrounding agriculture, one of them being the remunerative prices given to farmers.  Here we have to consider the fact that price is a factor of market forces and the government itself cannot play around with the same beyond a certain bandwidth. One classical yet reverse example to explain the case in point is the recent losses being incurred by petroleum companies in the event of the government trying to control it. The Public Sector Units (PSUs), however, are not impacted by such a move as the losses are later absorbed by the government through sacrificed losses or recapitalisation. But the private players have to bear the brunt in such a case, thus being a testament to this theory that remains true in the business of agriculture as well.

    What are the possible ways of fixing the demand-supply imbalance to improve the business aspect of agriculture? Can you also shed light on the implications in the event of not doing so?

    Creating a demand for the crop is important to avoid crashing of prices due to a demand-supply imbalance.  This is being done by the government through the Public Distribution System (PDS) or Food Security Mission, which is already a saturated mechanism. The second way is through creation of export opportunities and to provide an outlet for the surplus when the international prices are high. The government pursued the latter this year which ultimately led to the crop prices being higher than MSP. The major problem arises in a reverse case when international prices are low and there is more production in the country. In such a case, the government cannot buy all the crops at MSP because it lacks the financial resources to do so. And even if the centre is willing to somehow deploy resources, the same cannot be implemented keeping in mind the rules of the World Trade Organisation (WTO). In the event of not following the regulations, the country can be subjected to reverse pressures and penalties on other exports like marine and software to name a few.  Therefore, when demanding a certain MSP, the farmers should consider all the legalities involved as it’s not a matter of requesting charity from the government but a simple play of demand and supply and the resultant global implications.

    How can crop diversification be encouraged for better agribusinesses?

    We can consider the classical example of wheat which is one of the controversial crops and has a surplus production in Punjab, Haryana, Western Uttar Pradesh and some parts in Rajasthan and Madhya Pradesh. The farmers have been growing this in excess for the last 30 years knowing its low profitability in markets. This is because the commission agents are paid around 4-8 per cent interest by the Food Corporation of India (FCI) for procuring wheat and paddy. The farmers can instead grow mustard which is in short supply and can be cultivated under similar climatic conditions as wheat. Its production is far from profitable and hassle-free in terms of less use of water and fertilisers. But crop diversification is completely being overlooked when it is one of the biggest remedies to solve the business woes of agriculture.

    To resolve this, the foremost thing is to impart education to farmers to strengthen their business and economies of scale of the country as a whole. Secondly, better coordination between the farmers and the industry is required at large to which no state government is paying any heed. In this respect, the three farm laws were very important for bringing together the farmers and traders to eliminate the role of middlemen and foster better business growth in the long run. Thus, there is a crisis due to complete lack of education and communication wherein farmers need to be particularly taught about the economies of agriculture and not only about the economies of production. These two factors work in tandem with each other and cannot be left in silos.

    To read more click on: https://agrospectrumindia.com/e-magazine

    In an interaction with AgroSpectrum India, Vijay