Paddy procurement has decreased this year as farmers await improved incentives in expectation of the upcoming elections.
Government's paddy procurement has witnessed a decline as farmers hold off on selling their crop, expecting pre-election incentives in five states. This kharif season, the Food Corporation of India (FCI) and state agencies have acquired 14.7 million tonnes of paddy, down from last year's 15.9 million tonnes.
A government official pointed out that the decrease in paddy procurement and the sluggish pace can primarily be ascribed to farmers retaining their crops, expecting potential bonuses or special declarations leading up to the five state assembly elections scheduled for November 7 this year, as per a report by the Mint.
Chhattisgarh, Madhya Pradesh, Mizoram, Rajasthan, and Telangana are the states where elections are forthcoming.
The government of Chhattisgarh has committed to raising the paddy procurement price to Rs 3,600 per quintal while also introducing additional incentives for landless agricultural laborers. Currently, Chhattisgarh offers the highest paddy prices to its farmers, with the 2022-23 crop receiving Rs 2,640 per quintal for the common variety and Rs 2,660 for grade 'A' paddy, surpassing the Central government's minimum support price (MSP) of Rs 2,040- Rs 2,060.
Chhattisgarh has not recorded any paddy procurement this year, a stark contrast to the 8.7 million tonnes obtained in the last kharif marketing season, according to Food Corporation of India data. Similarly, Madhya Pradesh and Telangana have yet to kick off their procurement activities this season, despite having acquired 4.6 million tonnes and 6.5 million tonnes in the previous season, respectively. Rajasthan's procurement status remains undisclosed as the FCI lacks data on the matter.
In Punjab and Haryana, the states with the highest procurement levels, the government may purchase 8.7 million tonnes and 5.2 million tonnes of paddy in the current season, a decline from 9.7 million tonnes and 5.1 million tonnes during the same period in the previous year, as per the official's statement.
Punjab's paddy procurement process experienced a disruption this month due to a strike initiated by commission agents and rice millers. The minimum support price for kharif procurement had been revised to Rs 2,203 per quintal, which should have entitled commission agents to a fee of Rs 55.08 per quintal. However, it is reported that the Central government has fixed the commission at Rs 45.86 per quintal.