Govt starts mustard MSP purchases
By Sandip Das
Amidst the fall in mandi prices of mustard prices below the minimum support price (MSP) attributed to bumper output and cheaper imports of edible oils, the government has initiated purchase of oilseeds under prices support scheme (PSS) from the farmers.
Agriculture ministry officials said that over the next three months the target is to purchase 2.82 million tonne (MT) of mustard from the farmers under MSP operations in the key oilseed producing states of Rajasthan, Uttar Pradesh, Haryana, Madhya Pradesh and Assam.
The two agencies farmers’ cooperative Nafed and National Cooperative Consumers Federation (NCCF) in collaboration with state agencies have purchased 72,000 tonne of mustard in the last few days in these states.
“Procurement would pick up pace in the next couple of weeks,” an official told FE
Sources said that while in 2020 and 2021 the farmers have received remunerative prices which were reasonably above the MSP, prices have been ruling below MSP since last year as there has been an increase in imports of edible oil as global prices have softened and the government has slashed import duties.
Mandi prices of mustard seed, at Bharatpur (Rajasthan), the hub of the country’ trade, were ruling around average price of Rs 5100/quintal on Wednesday against a minimum support (MSP) price of Rs 5650/quintal for 2023-2024 season.
Roop Singh, CEO, Uttan Mustard Producers Company, a FPO based in Bharatpur said that farmers are holding on to their stocks in anticipation of realising better prices at par MSP.
Last year the government could purchase only 1.15 MT of mustard from the farmers under PSS.
In February, 2024, agriculture minister Arjun Munda had announced that the Centre would purchase mustard directly from farmers at the MSP of Rs 5,650/quintal to stabilise the market.
Meanwhile, the Solvent Extractors Association, a leading body associated with the edible oil industry in its first estimate on Wednesday projected mustard seed output at a record 12.08 MT for 2023-24 season, 7% up on year. As per the estimate share of key state in mustard output include Rajasthan (4.61 MT), Uttar Pradesh (2.03 MT), Madhya Pradesh (1.75 MT), Haryana (1.22 MT), West Bengal (0.7 MT) and Assam (0.2 MT)
The agriculture ministry, as per the second advance estimates of crop output recently, had projected mustard seed production at a record 12.69 MT in the 2022-23 crop year (July-June).
India’s import of edible oils – palm, soybean and sunflower – rose 17% on year to a record 16.47 million tonne (MT) in the 2022-23 oil year (November-October), helped by lower import tariffs of only 5.5% on crude oil imports.
The government has extended the lower import duty structure for palm, soybean and sunflower oils till March 31, 2025.
Due to large import of edible oil, the retail inflation in oil and fat category had been in the negative zone since February, 2023
Retail inflation in mustard oil in February, 2024 declined by 18.14% on year.
India imports about 58% of the total annual edible oil consumption of around 24 to 25 MT. Share of domestic edible oil includes mustard (40%), soyabean (24%) and groundnut (7%) and others.
This article has been republished from The Financial Express.