Chana prices are ruling at about 15 per cent lower than the minimum support price (MSP) of ₹5,230 per quintal in various mandis as arrivals have picked up in States such as Madhya Pradesh and Maharashtra among others. The modal price (the rate at which most trading took place) is ruling lower between ₹4,300 and ₹4,600 per quintal in various mandis across the key producing States, triggering demand from the trade for removal of curbs on stock limits and futures trading in chana.

“The chana crop is good and the market arrivals are about 25 per cent more in Maharashtra and Gujarat. Prices are 15 per cent lower than MSP and ruling at ₹4,300-4,400 per quintal,” said Bimal Kothari, vice-chairman, Indian Pulses and Grains Association (IPGA). The arrival pressure is such that last week in Akola, the market had to be closed for two days as traders couldn’t handle the huge volumes, he said.

Kothari doesn’t see any further fall in prices from current levels but said the government should remove the curbs on stock limits and allow futures trading in chana, which will support the prices, benefiting the farmers. At present, there is no interest from the stockists to invest due to the curbs on stock limits and ban on futures trading. Currently, traders are allowed to keep a stock of 200 tonnes at any point in time and millers can store up to six months of their processing capacity, he said.

The Agriculture Ministry, in its second advance estimates, released mid-February expects the gram production to be at a record 13.12 million tonnes, higher than the targetted 10.66 million tonnes and previous year’s output of 11.91 million tonnes. Kothari said the IPGA has no estimates on the chana crop as it has not done any survey. However, the crop is good, Kothari said.

Procurement at MSP

The process of public procurement for chana at MSP is in various stages in different States. Trade sources said prices may stabilise once the government agencies begin full-scale procurement.

Suresh Agarwal, President, All India Dal Mill Association in Indore, said chana is selling at the lowest price level below MSP and so are other pulses such as tur and moong. Agarwal also believes that chana prices are unlikely to go down further with the government commencing the purchase at MSP.

Vivek Agarwal of JLV Agro said the chickpea crop is very good this year and also there’s carry forward stocks from last year and as a result prices will remain bearish. The overall pulses complex is likely to remain range bound due to the government controls and import policies, which are aimed at ensuring prices remain stable.

Punit Bachawat, a miller in Ahmedabad said prices may move up from the current levels next month as farmers will hold back their produce and give it to NAFED as the MSP is ₹5,230, while current prices are hovering around ₹4,500 levels. The procurement has started in Gujarat, where the target is about 4 lakh tonnes, he said.

Touseef Khan, CEO, Gramophone, an agri-tech start-up, which is working with over a million growers in central India, said farmers are expecting prices to move up over the next few months and are selling in tranches. They are storing gram and not selling immediately, he said.