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Govt Initiates Direct Purchase of Mustard at MSP to Stabilize Market Amid Price Decline

The government initiates direct mustard procurement to stabilize prices amidst concerns over falling rates, while farmers demand MSP protection and policy reforms.

Shivam Dwivedi
Govt Initiates Direct Purchase of Mustard at MSP to Stabilize Market Amid Price Decline (Photo Source: Pexels)
Govt Initiates Direct Purchase of Mustard at MSP to Stabilize Market Amid Price Decline (Photo Source: Pexels)

The Indian government has announced its decision to procure mustard directly from farmers at the current Minimum Support Price (MSP) of Rs 5,650 per quintal, in reaction to the sharp decline in prices of mustard below the MSP. Agriculture Minister Arjun Munda disclosed this initiative on Wednesday, highlighting its aim to stabilise the market amidst anticipations of a bumper harvest.

Factors Responsible to Price Decline

The decline in mustard prices has been attributed to several factors, including the influx of inexpensive edible oils through imports facilitated by low duties until March 2025. Additionally, the entry of new mustard crops from the 2024 marketing season has intensified market saturation.

Projected Increase in Mustard Production

Trade sources project India's mustard production for the current year to reach approximately 13 million tonnes, a notable surge from last year's 11.3 million tonnes. This increase in production further exacerbates the downward pressure on mustard prices.

Current Market Scenario

Currently, mustard prices hover around Rs 5,100-5,200 per quintal, significantly lower than the MSP of Rs 5,650 per quintal. Last year, both central government agencies and state governments collectively procured approximately 2.8 million tonnes of mustard from farmers to mitigate price fluctuations.

Key Mustard-Producing States

Madhya Pradesh, Rajasthan, Gujarat, and Uttar Pradesh stand as the primary mustard-producing states in India, all governed by the Bharatiya Janata Party (BJP) at present.

Farmers' Demand for MSP Protection

In a related development, the Bhartiya Kisan Union (apolitical) submitted a memorandum to Agriculture Minister Arjun Munda, advocating for measures to ensure farmers are not compelled to sell their produce below the MSP in agricultural markets. This demand coincides with the impending march of thousands of growers to the national capital, scheduled later this month, where they will push for the legalization of MSP.

Proposals for Agricultural Reform

The memorandum, drafted after extensive deliberations among various farmers' groups in the national capital, also calls for reforms in agricultural policies. These include recognizing individual farmers as the unit for estimating insurance claims under the Pradhan Mantri Fasal Bima Yojana (PMFBY), which currently operates at the village level.

Additionally, the farmers propose the establishment of separate boards for the development of millet, cereals, fruits, rice, and oilseeds, akin to existing boards for coffee and tea.

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