Wheat prices are ruling below the minimum support price (MSP) of Rs 1,285 a quintal in several markets across North India, despite the Government procuring more than 40 per cent of the 2011-12 crop.
Inadequate procurement infrastructure in States such as Uttar Pradesh and Bihar, coupled with the Government’s recent moves to sell about three million tonnes at a subsidised price of Rs 1,170 a quintal to bulk users, has kept buyers away from the markets.
“When the Government is selling at a lower price, there is no question of prices going up in the market,” said Mr Adi Narayan Gupta, President, Roller Flour Millers Federation of India. Millers expect the Government to sell more at lower prices as it grapples with storage issues. The Centre has procured over 37 million tonnes from the latest crop estimated to be a record of over 90 million tonnes. High taxes in Punjab, Haryana and Uttar Pradesh have kept private sector buyers away from
“The Government should have allowed exports when the procurement was going on,” said Mr Ajay Jhakhar, Chairman, Bharat Krishak Samaj.
When faced with an unexpected gain in output and procurement touching a record high this year, the Government is struggling to handle the situation, said Dr Ashok Gulati, Chairman, Commission for Agriculture Cost and Prices (CACP).