NITI Aayog CEO Amitabh Kant said on Thursday that futures market can be beneficial for pulses farmers in terms of price realisation and hedging price risks.
Addressing the World Pulses Day event organised by the Indian Pulses Grains Association (IPGA), the apex trade body, Kant stressed upon the need for strengthening market access to farmers and said that procurement should be made in a timely manner so that they don’t bear the brunt of selling at market prices lower than the minimum support price (MSP).
“Given that prices of major pulses recurring crash below MSP, futures market can be beneficial to farmers,” he said. Presently, there is a ban on futures trading in pulses.
Opportunities for farmers
Further, Kant said that just as the millers, wholesalers and retailers are able to play the markets, farmers should be given similar options.
“Marketing opportunities need to be widened for farmers to benefit from higher price realisation either by streaming the physical value chain and reducing the margins or providing farmers the option of holding their produce in warehouses and participating in futures market,” he said.
Govt’s steps
Highlighting the steps taken by the government to promote pulses, Kant said the buffer target under the price stabilisation fund for pulses has been increased from 19.5 lakh tonnes in FY21 to 23 lakh tonnes in FY22.
Pulses can contribute to food security as they are suitable for marginal environment, drought resistant, affordable sources of protein and inexpensive compared to animal foods. The production of pulses has increased from 8.4 million tonnes (mt) in 1950-51 to a record 25.7 mt in 2020-21, Kant said.
The highest yield in pulses was registered at 853 kg per hectare in 2017-18 from a lowest of 377 kg per hectare in 1966-67, indicating the untapped potential for increasing yield through major technological breakthrough, he added.
Policy support
Bimal Kothari, Vice-Chairman, IPGA said that pulses deserve the policy support, research and investment support that fine cereals such as rice and wheat have received. The domestic production has increased in recent years and imports have come down from a peak of 6.6 mt four years ago to around 2.5 mt.
Kothari also made a case for modernising the thousands of dal mills in the country, majority of which are too small and do not enjoy scale of economies.
“I would urge the government to consider instituting a Dal Mill Modernisation Fund’. Once modernised, I am hopeful that foreign direct investment can flow into the processing sector,” Kothari said.