Amid the reports that the potato growers in Uttar Pradesh are getting a price of their produce which is less than the input costs, the Centre has decided to support the farmers by procuring nearly 1,00,000 metric tonne (MT) of potato at Rs 4,870 per MT under Market Intervention Scheme.
The Ministry of Agriculture and Farmers Welfare has approved the procurement of potato under Market Intervention Scheme (MIS) in Uttar Pradesh for the crop season 2016-17. A maximum quantity of 1,00,000 metric tonne (MT) of potato may be procured under the scheme by the State Agency, the Ministry said in a statement issued here today.
The purchase will be made at Rs. 4,870/- per MT. The Ministry will provide an additional Rs. 1217.50/- per MT or actual whichever is less for overhead expenses, such as transportation charges, mandi tax, and godown charges.
The Ministry said that purchase centres/areas will be decided by the state government in consultation with the state agency. “ The MIS will be implemented by the state agency. The Potatoes will be purchased from the Cooperative Societies, farmers’ organizations or directly from the farmers to eliminate the possibility of middlemen taking advantage of the scheme. The state government will ensure that the produce is purchased from genuine farmers only,” it said.
The procured stocks will be disposed of in the open market to ensure maximum realizable price. If necessary, this can also be sold to processing units within the state. The state agency would also make efforts to export the procured potatoes after processing.
In order to avoid recycling, the stock would not be sold in the same market / state from where it has been procured during the period of the scheme. However, if the prices are better it can also be sold, locally.
The Ministry has clarified that barter payments or payments in kind to farmers for procurement won’t be allowed. Payment to farmers as far as possible will be made through non-cash transaction and receipts for sales must be through banking channel only, preferably through Demand Draft.
Uttar Pradesh witnessed an increase of about 20 percent this year in the areas under potato cultivation. There has been increased production as the weather too remained conducive. According to media reports from leading potato growing districts of the state, farmers are getting Rs 3-4 per kg in the wholesale market for potato that is being sold at Rs 8-10 in the market. The cost of production alone has been around Rs 4 per kg and thus farmers are running into losses. Kannauj, Barabanki, Farukkhabad, Firozabad and Agra are some big potato producing areas. Last year, the potato market was good as farmers sold their yield for Rs 8-10 in the wholesale markets. This is what led to more farming of the crop this season.
As nearly 700 cold storages in the state are running full to capacity and with bumper production, it is widely feared that the farmers would have to sell off their produce at low prices. Farmers who manage to get their potatoes stored will be safe. But others are sure to incur huge losses. About 30 percent of the produce is likely to get either spoiled or farmers will be forced to sell it off for Rs 1-2 per kg.
Union Agriculture Ministry’s intervention at this stage would support farmers of Uttar Pradesh to get slightly more than their input cost. Procurement at nearly Rs 5 per kg by the government agencies would not only help farmers getting a price above their input cost but also reduce wastage to a large extent.