Kharif Crops: Govt raises paddy MSP by Rs 117 to Rs 2,300 per quintal for 2024-25

R ARIVANANTHAM
CHENNAI, JUNE 19

The Union Cabinet chaired by Prime Minister Narendra Modi on Wednesday approved the increase in the Minimum Support Prices (MSP) for all mandated Kharif Crops for Marketing Season 2024-25.

• This is the first cabinet decision taken in Prime Minister Narendra Modi’s third term in office: Information and Broadcasting Minister Ashwini Vaishnaw
• The government had a clear policy decision taken in the 2018 Union Budget that MSP should be at least 1.5 times the cost of production, and this principle was followed in the latest MSP hike: Vaishnaw

The hike in paddy support price comes despite the government sitting on surplus rice stocks, but it is significant ahead of elections in states like Haryana, Maharashtra, Jharkhand, and Delhi.

Cabinet approves Minimum Support Prices (MSP) for Kharif Crops for Marketing Season 2024-25

In the 2018-19 Union Budget, the Government of India had taken a policy decision of fixing the MSP at a level of at least 1.5 times the All-India weighted average cost of production

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Announcing the MSP increase, Information and Broadcasting Minister Ashwini Vaishnaw said the cabinet has approved the minimum support prices for 14 kharif (summer) crops based on recommendations from the Commission for Agricultural Costs and Prices (CACP).

The MSP for ‘common’ grade paddy has been raised Rs 117 to Rs 2,300 per quintal, while for the ‘A’ grade variety it has been hiked to Rs 2,320 per quintal for the upcoming kharif season, Vaishnaw told reporters.

The highest absolute increase in MSP over the previous year has been recommended for oilseeds and pulses viz. nigerseed (Rs.983/- per quintal) followed by sesamum (Rs.632/- per quintal) and tur/arhar (Rs.550/- per quintal).

This is the first cabinet decision taken in Prime Minister Narendra Modi’s third term in office, the minister said.

Vaishnaw said the government had a clear policy decision taken in the 2018 Union Budget that MSP should be at least 1.5 times the cost of production, and this principle was followed in the latest MSP hike. The cost was scientifically calculated by CACP, he added.

The Food Corporation of India currently holds a record stockpile of around 53.4 million tonnes of rice, which is four times the required buffer for July 1 and sufficient to meet demand under welfare schemes for one year without any fresh procurement.

Despite lower rainfall of about 20 per cent across the country since the start of the monsoon season on June 1, weather conditions are now favourable for further advancement of the rains, according to the meteorological department.

Minimum Support Prices for all Kharif crops for Marketing Season 2024-25

Rs. per quintal

*Refers to cost which includes all paid out costs such as those incurred on account of hired human labour, bullock labour/machine labour, rent paid for leased in land, expenses incurred on use of material inputs like seeds, fertilizers, manures, irrigation charges, depreciation on implements and farm buildings, interest on working capital, diesel/electricity for operation of pump sets etc., miscellaneous expenses and imputed value of family labour.

A Cost data are not separately compiled for Paddy (Grade A), Jowar (Maldandi) and Cotton (Long staple)

The increase in MSP for Kharif Crops for Marketing Season 2024-25 is in line with the Union Budget 2018-19 announcement of fixing the MSP at a level of at least 1.5 times of the All-India weighted average cost of production, The expected margin to farmers over their cost of production are estimated to be highest in case of bajra (77%) followed by tur (59%), maize (54%) and urad (52%). For rest of the crops, margin to farmers over their cost of production is estimated to be at 50%.

In the recent years, Government has been promoting the cultivation of crops, other than cereals such as pulses and oilseeds, and Nutri-cereals/ Shree Anna, by offering a higher MSP for these crops.

During the period 2003-04 to 2013-14 for 14 crops covered under Kharif Marketing Season, the minimum absolute increase in MSP was Rs.745/- per quintal for Bajra and maximum absolute increase was Rs.3,130/- per quintal for Moong while during the period 2013-14 to 2023-24, the minimum absolute increase in MSP was Rs.780/- per quintal for Maize and maximum absolute increase was Rs.4,234/- per quintal for Nigerseed. Details are at Annexure-I.

During the period 2004-05 to 2013-14, the procurement of 14 crops covered under Kharif Marketing Season was 4,675.98 Lakhs Metric Ton (LMT) while during the period 2014-15 to 2023-24, procurement of these crops was 7,108.65 LMT. The year-wise details are at Annexure-II.

As per the 3rd Advance Estimates of production for 2023-24, total foodgrain production in the country is estimated at 3288.6 Lakhs Metric Ton (LMT), and oilseeds production is touching 395.9 LMT. During 2023-24, kharif production of rice, pulses, oilseeds and nutri-cereals/Shree Anna and cotton is estimated to be 1143.7 LMT, 68.6 LMT, 241.2 LMT, 130.3 LMT and 325.2 Lakh bales, respectively.

Annexure-I      Rs. per quintal

Annexure-II

Procurement of Kharif Crops 2004-05 to 2013-14 and 2014-15 to 2023-24

In LMT