To dispose of the previous year’s stocks in the open market, the government has allowed Food Corporation of India (FCI) to sell around 11,000 tonne of tur or arhar through NCDEX from its buffer stocks.
Sources told FE that while FCI had purchased around 20,000 tonne of tur from farmers last kharif season (2015-16) to create buffer stocks of pulses, only around 9,000 tonne of pulses were lifted by the states. The remaining pulses would be sold through NCDEX e-Market (NeML),an arm of commodity bourse NCDEX.
However, the reserve prices of tur to be sold through NCDEX e-Market would be around the minimum support price (MSP) of R5,050 per quintal, which is offered to farmers in the current year, while FCI had purchased tur at a much higher price of around R8,000 per quintal from farmers last year. “Pulses under the buffer stocks can’t be stored for longer duration, thus FCI will be sell the last year’s leftover stocks in the open market using spot markets like NeML,” a consumer affairs ministry official said.
FCI had recently sold around 2,000 tonne of chana (chickpea) through NeML and realised better prices than the price at which the corporation had purchased the pulses from farmers. However, in the case of tur, the corporation will be forced to sell the pulse through NeML below its procurement prices, as new crops have already started to arrive in the market across the key growing states of Andhra Pradesh, Telangana, Karnataka and Maharashtra.
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With the market prices of kharif pulses prices, especially tur or arhar, falling below the MSP in key growing states, the National Agricultural Cooperative Marketing Federation of India (Nafed) recently commenced procurement of key pulses from the farmers. Officials said that around 1,300 tonne of tur have been already purchased by Nafed for buffer stocks through procurement centres at Narayanpet, Tandur and Mahbubnagar (Telangana), Latur (Maharashtra), and Bidar and Kalaburgi (Karnataka).
Last year, pulses prices, especially tur and urad prices, skyrocketed forcing the government to step up imports and announce abolition of import duties. The government also announced the creation of buffer stocks of 2 million tonne (mt) by entrusting NAFED, FCI and Small Farmers’ Agri-Consortium (SFAC) to source pulses domestically as well as from imports using the Price Stabilisation Fund.
