MUMBAI (Commoditiescontrol) – Commoditiescontrol team had recently visited (16-23 December 2017) tur producing belts of Vidarbha, Maharashtra in order to get proper insight of tur crop situation (2017-18).
The team had covered Wardha, Hinganghat, Yavatmal, Washim and Akola districts and communicated with various market participants of tur such as farmers, government officials, seeds/pesticide dealers along with millers, traders and stockiest.
The main points discussed with every market participant has been highlighted below:
Farmers:
As per our conversations, most farmers in Vidarbha had witnessed fall in yields of around 30-40% compared to previous year.
The main cause for decline in yield was weather factor. Lack of rainfall during sowing period led to dry fields accompanied with high temperature during the growth stage damaged the crop of tur (For Interview Click Here).
Moreover, limited fields (around 10-15%) have irrigation facility in the region, rest all other farmers mainly depend on the monsoon rain for good crop.
Some farmers having irrigated land also faced hurdles due to insufficient electricity supply causing scarcity of water to the crop during the growth stages (For Interview Click Here).
Selective farmers also noted a disease (known as keed) as pesticides were not very affective this season and problems of local animals trespassing and damaging the crop during sowing and harvest period had also added to distress (For Interview Click Here).
The acreage of tur was also a bit less compared to previous year as prices had fallen way below the minimum support price of Rs.5,450/100Kgs (includes bonus of Rs.200) in the market. Farmers in the region had shifted to soyabean and cotton for better returns.
Despite government procured large chuck of tur in last season (2016-17) at MSP Rs.5,050/100Kgs, farmers faced various difficulties as follows:
• Payment issues (delay of around 1-3months)
• Stringent quality check (leading to rejection of crop)
• Abundant crop and low prices in APMC market led to bottle-neck situation at procurement centers.
• Lack of warehouse facility.
Many farmers sold their tur produce to traders and millers at Rs.3,800-4,000 and incurred losses after facing problems to sell to government agencies. This kept the sentiments of famers dull for current season 2017-18.
Government Officials & Agencies:
In order to support farmers from distress sell in market, government agencies had procured huge stocks of tur produce of farmers at minimum support price of Rs.5,050/100Kgs (MY 2016-17).
Despite good procurement many farmers were unsatisfied with many issues mentioned above (For Interview Click Here).
In the previous year, registration was done by AMPC then forwarded to district marketing office creating hurdles in procurement (For Interview Click Here).
Traders and businessmen had also taken undue advantage of farmers by using their land documents (7/12) and selling their stocks of tur at higher MSP rates to government.
The officials involved in procurement suggest that farmers should not provide their documents to any private players (For Interview Click Here).
The government has decided to tackle these problems by:
• Increased minimum support price to Rs.5,450/100Kgs (includes bonus Rs.200).
• Prior online registration with limited documentation (offline last year).
• Registration process and help provided by district marketing office instead of APMC’s.
• Farmers notified with SMS to their cell/mobile phone in regional language about procurement process.
• A small sample of tur to be tested to tackle quality issue and loss of transport cost incurred by farmers.
• Limited number of farmers will be notified in a single day of procurement to avoid bottle-neck situation.
• Payment to be made through RTGS directly within 7-8 days to farmers bank account.
• Currently procurement of Urad and Moong (Kharif 2017-18) is in progress at MSP rate which is functioning in a systematic manner.
Millers & Traders/Stockiest:
The most important problem faced by millers and traders/stockiest are dynamic changes in government policies which are taken overnight.
Moreover, most notification issued by government (about import ban/duty, stock limit etc.) are during non-trading hours affecting and hampering the business of most market players (For Interview Click Here).
After prices of tur fell drastically in the market due to bumper production of commodity in kharif 2016-17, stockiest opted to remain on the sideline. Most of market participants were in distress as they had previously purchased tur at higher rates. Moreover, they are aware that most inventories of tur (2016-17) are in the hands of government which will play a vital role (For Interview Click Here).
Looking at the scenario of previous year, millers and traders were only interested in buying tur in limited quantity in order to fulfill their basic requirements and would mostly avoid any bulk-buying.
Seeds/Fertilizers Provider:
Farmers across the Vidarbha belt mainly prefer maruti, duftari, charu varieties of tur seeds, but some other varieties of tur are also preferred depending on the quality of soil as most lands are non-irrigated (For Interview Click Here).
Usually, farmers purchase seeds of tur in a particular pattern i.e. once in every two or three years depending on yield. The main reason to purchase in such a pattern is to reduce cost of cultivation.
Moreover, farmers usually prefer seeds that are manufactured by government companies instead of private agencies as they are available at a cheaper rate.
Farmers purchase fertilizer and use it for tur crop in early stages. In addition, they spray pesticides twice or thrice according to requirement during the growth stages.
Effect On Prices Of Tur:
The reports suggest that farmers are likely to try and liquidate their tur produce to government at minimum support price of Rs.5,450/100Kgs as prevailing market rates are yet below MSP level.
If the procurement process of tur by government is done in a systematic order without many difficulties, then major new crop supply of tur will be sold to government agencies by farmers.
This will lead to slow supply of tur in the open market for traders and millers creating shortage of commodity which will support the prices from prevailing level.
The chances are that government may reduce their procurement target for this season as most warehouses are occupied with inventories of old tur (kharif 2016-17). Meanwhile, government was active to liquidate stocks to market participants by issuing tenders and PDS in order to make room for procurement of new tur (2017-18).
If farmers face hassle in selling their produce to government similar to the previous year then supply pressure is likely to divert towards private player, which will push down the prices of tur from the current market rates.
Conclusion:
As per analyses of team Commoditiescontrol, prices of tur may remain range bound as the commodity had surged in the previous week (17-22 Dec) mainly on cues of lower yield, delay in harvest of new crop and thin stock of old tur with millers, farmers, and traders this year. However, when supply of tur will gain momentum (Jan 15-Feb 15) correction could be witnessed.
Note: Click on the video links (Youtube) attached above to get insight of tur from farmers, traders/stockiest, millers and government officials. Subscribe to our Youtube channel, also like, share and comment. Stay tuned for more updates.
(By Commoditiescontrol Bureau; +91-22-40015523)
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