India Finance News

UP logs 80% upswing in paddy procurement at 4 mn tonnes this Kharif season

The Uttar Pradesh government has logged an 80 per cent year-on-year growth in paddy procurement in the current kharif marketing season with the state agencies procuring almost 4 million tonnes (MT) so far.

The paddy procurement in the corresponding period last year stood at roughly 2.2 MT compared to 4 MT this season, an upswing of 80 per cent.

This year, the Adityanath government has set a target of procuring 5 MT of paddy, of which the state has already achieved nearly 80 per cent of the seasonal target.

Paddy procurement in UP had commenced on October 1 and is slated to continue till February 2020=-end.

The purchase by the government agencies, including Food Corporation of India (FCI) has been quite robust since the beginning due to the priority accorded by the government for seamless procurement apart from the emphasis of the state for making the fields ready for the successive rabi sowing, especially wheat.

About 3,940 procurement centres, including 103 operated by the FCI, had been set up across the 75 UP districts to facilitate direct purchase from paddy farmers.

According to official estimates, about Rs 7,250 crore had been paid to the state paddy farmers directly into their registered bank accounts against procurement.

Recently, UP agriculture minister Surya Pratap Shahi had told Business Standard that under previous state regimes, the paddy farmers used to receive their payments after long delays of up to three months, while the current dispensation was ensuring that such payments were made promptly after procurement.

In 2016-17, 2017-18 and 2018-19, UP clocked paddy procurement numbers of about 3.5 MT, 4.3 MT and 4.9 MT respectively against the respective seasonal target of 5 MT.

In September 2019, the UP cabinet had announced the paddy procurement policy for 2019-20, increasing the minimum support price (MSP) to Rs 1,835 per quintal for grade A paddy, apart from provisioning Rs 20 per quintal additional for farmers as transport and other support. This hiked the effective state paddy procurement price to Rs 1,855 per quintal.

Meanwhile, the policy also provided for not only boosting speedier procurement of the staple food grain, but promoting paddy contract farming and share cropping with a view to ultimately augmenting the farm income and promoting the export of agricultural commodities.

In fact, UP is among the major paddy producing states, apart from a big rice consumer as well under the public distribution system (PDS). The state annually requires almost 4 MT of custom milled rice for consumption.

The institutional procurement mechanism ensures adequate contribution to the central PDS pool, apart from facilitating remunerative prices to farmers and setting a price benchmark for their produce. The farmers are free to sell paddy to private purchasers or traders if they get better prices.

Source: Business Standard

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