December 21, 2023
Michelle Dennis talks to Rishabh Agrawal, Managing Director of Kamal Pulses about the challenges facing Indian pulse markets and gets his insights into the strategic initiatives taken by the Indian government.
Certainly. The current landscape of tur production in India reflects a challenging reality marked by a shortfall in production against the backdrop of robust domestic consumption. This disparity has resulted in a notable deficit, prompting the government's strategic decision to release 50,000 tonnes from the buffer stock. While the initiative is commendable, it's crucial to acknowledge the complexities of the production-consumption gap, and unfortunately, the impact on market prices remains somewhat marginal.
Absolutely. The government has adopted a multifaceted approach in response to escalating tur prices. This comprehensive strategy includes not only the release from the buffer stock but also incorporates imports from East African countries and the imposition of stock limits. While these measures aim to provide immediate relief, the broader challenge lies in effectively bridging the consumption-production gap. The release from the buffer stock is a pivotal component of a broader initiative aimed at stabilizing the market and ensuring sustained availability.
Wilt disease, caused by the soil-borne fungus Fusarium udum, has led to a substantial 30-40% reduction in yield. Recognizing the severity of these challenges, the government has proactively initiated strategies to mitigate their impact. Promoting crop rotation and advocating for seed treatments with fungicides are among the key measures undertaken to enhance the resilience of tur cultivation against environmental adversities.
Stock limits have undeniably provided a temporary respite, yet their efficacy in stabilizing prices has been rather fleeting. Despite rigorous government surveys finding no evidence of hoarding, retail prices have experienced a substantial 40% surge. This suggests that while stock limits contribute to immediate control, broader market dynamics and production-consumption gaps continue to exert significant influence on retail pricing.
In response to the prevailing pulse price spike, the government is adopting a proactive stance to manage inflation while ensuring equitable returns for farmers. By directing farmers to increase tur production through measures such as raising the Minimum Support Price (MSP) and direct procurement via the Price Stabilization Fund (PSF), the government aims to strike a balance between consumer affordability and fair compensation for farmers.
The decision to dispose of tur through online auctions is rooted in the government's strategic imperative to control rising prices until imports normalize. Online auctions are anticipated to introduce transparency into the process, fostering market stability through efficient and accessible mechanisms. This approach aligns with the broader goal of ensuring fair market dynamics and mitigating the impact of speculative activities on prices.
Recognizing the historical inclination of farmers to sell to traders and stockists, the government has implemented directives to NAFED and NCCF for direct procurement at market rates higher than MSP. This proactive step, funded by the Price Stabilization Fund, aims to incentivize farmers by providing a reliable market and encouraging their active participation in government procurement programs.
In a concerted effort to promote sustainable tur production, the government has initiated a multifaceted approach. This includes the distribution of Seed Mini kits, the establishment of Pulses Seed Hubs, and the provision of production incentives. These initiatives collectively contribute to fostering sustainable agricultural practices, ensuring the well-being of both farmers and consumers.
The record production of chana has prompted the government to adopt a proactive procurement strategy, primarily centered around securing excess stock at the MSP. This strategic buffer stock not only serves as a safeguard against potential market fluctuations but also contributes to ensuring market stability in the future. The implications for storage involve a meticulous approach to warehousing, aligning with the government's commitment to effective market management.
NAFED's offer of excess chana to states at a discounted price reflects the government's commitment to optimizing the utilization of surplus stock. The distribution strategies, channeled through social sector programs, encompass avenues such as mid-day meals, integrated child development services, and public distribution systems. This ensures not only the efficient utilization of surplus chana but also contributes to essential social programs, fostering a holistic approach to food distribution.
The global landscape presents challenges and opportunities for chana exports from India. The rising global demand offers lucrative opportunities, particularly from countries like China, UAE, and Bangladesh. However, challenges such as low productivity, adherence to stringent international standards, and the short shelf life of chana necessitate meticulous planning. The government is navigating this complex global pulse market by emphasizing adherence to international quality standards, exploring innovative export channels, and engaging in strategic collaborations to enhance the competitiveness of Indian chana in the global arena.
The government's approach to addressing potential shortages in moong, urad, and tur involves vigilant monitoring, timely imports, and strategic releases from the buffer stock. This proactive strategy aims to prevent shortages and meet consumer demand, aligning with the government's commitment to ensuring the stability of the pulse market.
They have fundamentally transformed the relationship between industries and farmers. MSP, by ensuring financial stability and fair returns, has fostered a robust trust between the two stakeholders. This dynamic relationship supports sustainable agriculture and guarantees a consistent market for farmers, aligning with the government's broader vision for the holistic development of the agricultural sector.
It was my pleasure. Thank you for having me, and I look forward to continued discussions on the evolving pulse industry.
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