Not many takers for govt drive to procure tur dal at market rates

The central government's drive to procure tur dal at open market rates to refill its stocks has so far received a lukewarm response from farmers even as it has helped push prices up, industry insiders said.

Small farmers continue to sell to private traders while many bigger farmers have opted to hold the crop, expecting the prices to increase further as tur/arhar prices continue to remain firm and the new crop is expected to be in deficit, they said.

This is the first time that a central government agency has entered into a competition with the private trade to buy tur for the government stocking. National Agricultural Co-operative Marketing Federation of India (Nafed) has been running procurement centres in Maharashtra and Karnataka. However, according to trade sources, Nafed has managed to get only about 2,000 metric tonnes of raw tur till last week.


The dynamic pricing formula adopted by the government - which uses average price of the previous three days - its stringent quality norms, and formalities involved in selling to government agencies along with the ease of payment in private deals are among the key reasons for farmers' lack of interest, industry insiders said.

"The dynamic price of the government was lower by Rs 3-4/kg than the market price, which led to farmers choosing the private traders over the government agencies to sell tur," said Rupesh Rathi, a dal miller from Akola in Maharashtra.

Raw tur prices are currently ruling near ₹100/kg in wholesale mandis, which is 40% above the minimum support price (MSP) of ₹70/kg. Tur dal, after processing at dal mills, is trading around Rs 140-145/kg at mill gate and upwards of ₹180/kg in retail.

PRICES RISING

Although the government is struggling to get tur/arhar, its presence in the market has led to an increase of about 15% in its prices in the last two months, traders and processors said. "As the government is present in the market to buy arhar, there are no chances of prices coming down anytime soon," said Suresh Agarwal, president of All India Dal Millers Association.

jayashree.bhosale@timesgroup.com