Resource centre on India's rural distress

Pulses buffer stock


The Agriculture Ministry has moved a proposal to create a buffer stock of 3.5 lakh tonnes of lentils during the current 2015-16 crop year through domestic purchase or imports to prevent a further price rise in pulses.

“The Agriculture Ministry has sought inter-ministerial comments on a proposal to create a buffer stock of 3.5 lakh tonnes of pulses in 2015-16 crop year,” sources said.

Out of the proposed 3.5 lakh tonnes, about 1.5 lakh tonnes of tur and urad will be procured in the ongoing kharif marketing season and the rest 2 lakh tonnes of chana and masoor will be bought in the rabi marketing season.

These pulses will be purchased locally or through imports using the Rs.500-crore Price Stabilisation Fund and a scheme that supports MSP operations. Pulses will be procured both at the minimum support price as well as market rates.

The State-owned Food Corporation of India (FCI), Small Farmers’ Agriculture-Business Consortium (SFAC) and Nafed will be engaged in the pulses procurement, they added.

In the ongoing kharif marketing season, which started last month, the Ministry has proposed that FCI will procure 1 lakh tonnes of tur and urad while Nafed and SFAC will buy 40,000 tonnes and 10,000 tonnes, respectively. In the rabi marketing season starting in March next year, Nafed will buy 1 lakh tonnes of pulses while FCI and SFAC will go for 90,000 tonnes and 10,000 tonnes, respectively.

Emphasising on the need to create buffer stock of pulses, the Ministry in the Cabinet note has argued that assured procurement of lentils at MSP will attract more farmers to take up pulses cultivation, which in turn would boost domestic supply and help control prices.

The need for creating the buffer stock arose as retail prices have gone through the roof due to a fall in domestic output by two million tonnes in 2014-15 crop year (July-June) and a global shortage.

For instance, retail tur and urad prices have jumped sharply up to Rs.190-200 a kg despite government measures to check hoarding and imports.

Pulses production fell to 17.20 million tonnes in 2014-15 crop year due to poor rains, against 19.25 million tonnes in the previous year. The country imported more than 4 million tonnes during the last fiscal and traders expect imports to cross 5 million tonnes this fiscal.

Despite a higher MSP, the pulses cultivation has not scaled up to meet the growing demand because of inadequate supply of pulses seeds in the country. Worse, pulses are more prone to pest attacks unlike other crops and are mostly grown in rain-fed areas.