1. Minimum Support Prices (MSP)

Table 1. Minimum Support Prices Recommended by CACP and Fixed by

Government for 2017-18 in Rs. /Quintal

Commodity MSP recommended Additional bonus/Quintal MSP Declared

Paddy Common # 1550 0 1550

Paddy (F)/Grade'A' 1590 0 1590

Jowar-Hybrid 1700 0 1700

Jowar-Maldandi 1725 0 1725

Bajra 1425 0 1425

Ragi 1900 0 1900

Maize 1425 0 1425

Tur (Arhar) 5450 200 5450

Moong 5575 200 5575

Urad 5400 200 5400

Groundnut 4450 200 4450

Sunflower Seed 4100 100 4100

Soyabean Black 3050 0 3050

Sesamum 5300 100 5300

Nigerseed 4050 100 4050

Medium Staple Cotton 4020 0 4020

Long Staple Cotton 4320 0 4320

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MSP

Crops

Minimum Support Prices Recommended by CACP and Fixed by Government (2017-18) in Rs./Quintal

MSP Additional bonus/Quintal

1. Price trends of selected commodities

Table 2. Commodity wise Monthly Wholesale Prices of (Rs. /Quintal)

Sr. No. Commodity Prices May, 2017 Prices June, 2017

1. Paddy 1725 1742

2. Wheat 1807 1726

3. Maize 1422 1406

4. Jowar 2009 1960

5. Bajra 1352 1349

6. Gram/Chana 6478 6059

7. Redgram 5698 5257

8. Green gram 5782 5495

9. Black gram 6370 6125

10. Soybean 3091 3085

11. Groundnut 5272 4819

12. Sunflower 2751 2857

13. Red Chilli 7383 5937

14. Potato 760 887

15. Tomato 1516 2037

16. Onion 1005 1222

17. Cotton 5130 5123

18. Sugarcane 230 230

19. Mango 2817 2933

20. Grapes 3549 3211

2. Climate Conditions

Monsoon will progress on schedule: IMD

Despite media reports claiming that that the southwest monsoon might skip central India and

travel straight to the north, Indian Meteorological Department officials said the rains have not

been disrupted in any region. A report in The Times of India had quoted an unidentified official

from the Met Department as saying that the monsoon seemed to be travelling directly from

the south to the north of India, skipping the northern parts of eastern Maharashtra and some

parts of Chhattisgarh, Madhya Pradesh and Jharkhand. However, representatives at the India

Meteorological Department clarified to Scroll.in that the monsoon will advance as normal. The

southwest monsoon has advanced across some parts of central and eastern Maharashtra,

Chhattisgarh, Jharkhand and Bihar, most parts of Odisha, and the rest of West Bengal.

Favourable conditions are developing for the advance of the southwest monsoon further

north.

The monsoon has already reached Karnataka, Goa and the Konkan on the western coast while

on the eastern coast it has covered Andra Pradesh, Odisha, parts of Telangana and the North

East. At least five drought-prone districts in Vidarbha in eastern Maharashtra have already

received rainfall this year. The India Meteorological Department had initially estimated on

May 30 that the monsoon would advance at a faster pace than normal. However, the monsoon

has remained stationary over central India. While the Indian Meteorological

Department predicted a forecast of Long Period Average of 98%, Skymet Weather Services, a

private company that provides weather forecast, predicted that the Long Period Average will

remain below normal at 95%. Long Period Average is a forecast with a time span or a validity

period beyond 10 days. Usually, this is issued for a season. The Long Period Average for the

southwest monsoon is from June to September.

3. Agriculture and food news

Foodgrain may not be cheaper under GST

The GST Council has proposed a zero rate structure or

nil tax for most of the food grain. However, branded

food will be taxed at 5%. Neither the Council nor the

ministry clarified what constitutes branded food. But

all the food-related packaged commodities have to be

registered under the Food Safety Standards Act

(FSSAI). The moment a trader lists himself under this

Act, his commodity becomes branded.

By that standard, all packaged food will have to be

taxed at 5%. Only those that come loose and sell

mostly in mom and pop stores and roadside vendors

will qualify for nil tax. “We have appealed to the

finance minister to come out with a categorical

classification of branded and non-branded food items

as the traders are really confused,” said apex traders’

body CAIT’s chief, Praveen Khandelwal.

Govt. won't hike PDS foodgrain prices for another year

The government decided not to hike prices of

foodgrains sold under the Food Law via ration shops

for one more year. Under the National Food Security

Act (NFSA), which was passed in 2013 during the

previous UPA regime, there is a provision for revision

of the issue prices of foodgrains every three years.

At present, the government supplies highly subsidized

foodgrains at Rs 1-3/kg to over 81 crore people in the

country, costing the exchequer about Rs 1.4 lakh

crore annually. The government's focus would be on

ensuring "nutritional security" of the poor people

registered with PDS. The ministry has chalked out

plans for supplying fortified wheat and rice flour via

PDS, and is deliberating with stakeholders on

supplying nutritious food in a cost effective manner.

Hybrid seed prices cut by 10 % for kharif season

Giving some relief to farmers burdened with high

production costs, the seed industry decided to cut

retail prices of hybrid seeds, excluding cotton, by 10

per cent from June 19 through the ensuing 2017- 18

kharif season. The decision in this regard was taken at

a meeting called by Union Agriculture Minister

Radha Mohan Singh here to reduce voluntarily the

seed prices.

Besides the National Seeds Association,

representatives from the Federation of Seed Industry

of India (FSII) were present in the meeting. Global

seed firms Monsanto, Bayer and Syngenta are

members of FSII. More than 80 per cent of seeds sown

are hybrids in the country. The size of hybrid market

is about Rs 6,000 crore.

Govt. releases Rs 700 crore to NAFED for buying pulses

at MSP

The Centre has released Rs 700 crore to cooperative

Nafed to undertake procurement of rabi pulses and

other agri-produce, grown in the 2016-17 crop year, at

the support price and protect growers from falling

prices. The fund, made available under the Price

Support Scheme (PSS) operated by the Agriculture

Ministry, will also be used to clear all outstanding

payments to farmers for procurement of pulses,

mustard seed, groundnut and other commodities

undertaken in the 2016-17 crop year that ends this

month.

The purpose of PSS is to protect farmers with the

minimum support price for their produce in times of

price fall. Nafed is procuring pulses under two

government schemes viz; PSS and PSF (Price

Stabilization Fund). Nafed had procured pulses and

other commodities worth Rs 5,800 crore during 2016-17

fiscal mainly under the PSF. In the current fiscal so far,

the cooperative has undertaken procurement to the tune

of Rs 2,500 crore.

Govt. increases MSP of pulses, oil-seeds and cotton

Amid unrest among farmers for multiple reasons in

different states, the Center has increased the minimum

support price (MSP) of pulses, oil-seeds and cotton for the

2017-18 crop year and asked states to procure it by all

means so that the farmers are not forced to sell it at low

prices. Idea of this move is to provide remunerative prices

to farmers when the prices are under pressure due to

supply glut. The maximum hike in the MSP is fixed for

pulses whose output is estimated to be a record 22.40

million tonnes (MT) in the 2016-17 crop year ending June,

as against 16.35 MT in 2015-16.

The record production was attributed to good monsoon,

higher MSP and better procurement arrangement. The

MSP of tur (arhar) is increased from Rs 5,050 per quintal

(including bonus) in 2016-17 to Rs 5,450 per quintal

(including Rs 200 bonus) in 2017-18 a hike of 400 per

quintal. Similarly, the support price of Urad increased from

Rs 5,000 (including bonus) per quintal in 2016-17 to Rs 5,400

(including bonus) per quintal in 2017-18. In case of Moon

Dal, it is increased from Rs 5,225 (including bonus) per

quintal in 2016-17 to Rs 5,575 (including bonus) in 2017-18.

Contract farming will give a boost to Indian agriculture

India is predominantly a rural economy. Agriculture and allied sectors presently employ

almost half of the country’s total workforce. Development in agriculture is therefore one the

most important pillars of socio-economic growth. While efforts are on to increase the emphasis

on the modernization of agriculture with corrective policy changes, the slowdown in

agricultural growth in recent years is a cause of concern for our economists in the recent

past. Hands-on, process-oriented approach is needed to meet the challenges of the sector

agriculture sector.

The emergence of contract farming via revolutionary farm-firm linkages can create

unparalleled value addition here. Following announcements by Finance Minister in this year’s

Union Budget to create a new legislation as a part of the reform measures for agriculture, the

NITI Aayog (erstwhile Planning Commission) is preparing an outline structure for the

proposed Contract Farming Law, to connect farmers with all stakeholders. Contract farming

is defined as agricultural function carried out as per an agreement between corporates and

farmers, where production and marketing aspects of one or more farm products are looked at

in an integrated manner with partnership. When it comes to contract farming, in some cases,

the farmer himself may agree to provide specified quantities agricultural products to the

buyers, in others, quality standards are often determined by the purchaser up to a certain

extent.

India’s edible oil security is at risk

At a time, when farmers are exploring various profitable

crop options for cultivation during the upcoming kharif

sowing season, the sustained low prices of oilseeds may

make farmers dis-interested towards oilseeds cultivation

thereby putting India's edible oil security at risk. Key edible

oil prices including soybean, rapeseed and groundnut prices

have declined in the range of 20-28 per cent since June last

year. Against the Minimum Support Price (MSP) of ₹ 2,775

per quintal, soybean prices quoted at ₹ 2,550, while

rapeseed prices hovered around ₹ 3,250 a quintal against

the MSP of ₹ 3,700 and groundnut prices quoted at ₹ 3,500

a quintal against the MSP of ₹ 4,220 a quintal.

Prices lowest in five years

The South-West Monsoon has already marked its entry

from Kerala and is expected to cover the whole of the

country in the next 10-15 days. “However, the current price

level is the lowest in the last five years and farmers are

totally discouraged to sow oilseeds in the current kharif

season. This has happened probably for the first time in

decades and needs immediate action,” SEA wrote in its

letter dated June 5. The SEA suggested remedial measures

to ensure farmers do not loose total interest in oilseed

cultivation.

Oilmeal exports increased by 69%

Export of oilmeals, used as animal feed has gone up by 69 per

cent to 97,871 tonnes during May due to better price parity in the global market, an industry

body SEA said. Though exports are showing an improvement in percentage terms, they are

still lower when compared to the earlier years, it said in a statement. Oilmeals shipments stood

at 57,954 tonnes in May 2016. "In last two months, the export of oilmeals improved as

compared to the previous year due to good monsoon, better oilseeds production and price

parity," Mumbai-based Solvent Extractors Association of India (SEA) said.

During April-May period of this fiscal, 3, 015, 69 tonnes was exported as against 1, 71, 932

tonnes in the year-ago period, it said. Among types of oilmeals, shipment of soyabean meal

increased to 48,159 tonnes in May 2017 from 10,400 tonnes and rapeseed meal rose to 42,488

tonnes from 3,090 tonnes in the said period. However, the shipment of rice bran extraction fell

sharply to 5,200 tonnes from 42,032 tonnes and castor seed meal to 2,024 tonnes from 2,432

tonnes in the said period.

Livestock farming may become less profitable

Amid the raging debate about the ban on the sale of cattle

for slaughter at animal markets, Chief Economic Advisor

Arvind Subramanian has said that livestock farming

could become less profitable if social policies drive what

has to be done with unproductive cattle. In his

Foundation Day Lecture of National Academy of

Agricultural Sciences, Subramanian said governments

have the right to choose their social policies, "but in doing

so they must be fully aware of the economic costs of these

policies".

The CEA said it must be recognized that the economics

of livestock farming, and hence the fate and future of this

source of livelihood, will depend critically on the

terminal value of assets, in this case, the no-longer-

productive livestock. The declining terminal value arises

both because of the loss of income from livestock as meat

and the additional costs that will arise from having to

maintain unproductive livestock, he said.

GST will increase farmer's burden Farmers are not upbeat despite a heavy monsoon period

expected which will enhance their harvest, as the

proposed implementation of 18% Goods and Services Tax

(GST) on pesticides will add to their existing plight. Crop

protection products are an integral part of the green

revolution and play a crucial role in increasing

agricultural productivity. Indian crop protection industry

has made significant progress in terms of enhanced

production capacity and integration of imported and

indigenised technology to meet the overall requirement of

crop protection products in India.

To meet the foodgrain requirements of the nation,

agricultural productivity and its growth needs to be

further improved. In combination with Integrated Pest

Management and Plasticulture techniques, agrochemicals

play a critical role by providing pre and postharvest

protection to crops and agricultural output. The proposed

GST regime differentiates Crop Protection from seeds,

fertilizers, farm equipment, etc. Seeds (exempt), fertilizers

(12%), tractors (12%), crop protection products remain

taxable at 18%, depriving the industry of equal treatment

vis-à-vis other agricultural inputs.

Palm oil import rises 21.58 % in May

Palm oil import rose 21.58 per cent to

7,99,346 tonnes in May because domestic

vegetable oil output fell as farmers were

reluctant to sell oilseeds below the

minimum support price for processing,

industry body Solvent Extractors

Association (SEA) said. India, the world's

leading vegetable oil buyer, had imported

6, 57,454 tonnes palm oil in May 2016. The

SEA cautioned that lower realization could

impact planting of oilseeds in the ensuing

kharif season. To check price fall, the

industry body demanded the government

to immediately hike import duty on crude

and refined edible oil.

The country's total vegetable oil imports

remained flat at 13.84 million tonnes in May

this year from 10.24 million tonnes in the

year-ago period. Among soft oil, import of

sunflower oil increased to 1.54 lakh tonnes

in May this year, from 1.50 lakh tonnes in

the year-ago period. The shipment of

rapeseed-mustard oil also increased to

29,143 tonnes, from 18,718 tonnes, and the

import of soyabean oil rose sharply to 3.40

lakh tonnes from 1.78 lakh tonnes in the

period under review.

Indian spices export peaks high

Indian spices and spice products surged to

a record export worth of Rs.17664.61 crore

($ 2633.30 million) and a volume of 9,

47,790 tonnes in 2016-17. It registered an

increase of 12 per cent in volume, nine per

cent in rupee terms and six per cent in

dollar terms from a year ago. In 2015-16

export came to 8, 43,255 tonnes valued at

Rs.16238.23 crore ($ 2482.83 million).

Chilli continued to be the most demanded

spice in 2016-17 with export of 4,00,250

tonnes amounting to Rs 5,070.75 crores,

registering an increase of 15 per cent in

volume and 27 per cent in value. Cumin

was the second-most exported spice,

recording an increase of 22 per cent in

volume and 28 per cent in value. A total

volume of 1, 19,000 tonnes of cumin valued

at Rs.1963.20 crore was exported from

India in 2016-17.The spice which showed

the maximum increase as compared to the

previous financial year was fennel,

registering a 129 per cent increase in

volume and 79 per cent in value. Export of

garlic, nutmeg and mace and celery also

increased.

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