The Telegraph
Friday , January 24 , 2014
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Govt to prod mills for quota rice

Calcutta, Jan. 23: The government has decided to procure most of its quota of rice from mill owners before the usual time to keep the price of the crop in check by ensuring that demand does not fall.

The move, sources in the government said, was prompted by the cash constraints of the administration that was hobbling direct purchase from farmers.

The food and supplies department has called the state’s 800-odd mill owners to a meeting on January 28 to urge them to sell as much of the “levy rice” as it can before March. After the government procures the levy rice, it allows the mill owners to sell the same amount in the market. The government usually procures the levy rice, which it sends to ration shops, after March.

The government will not have to immediately arrange for the cash to procure the levy rice as it usually does not pay the mill owners at the time of procurement. But in case of direct procurement from farmers, the government tries to avoid making them wait for payments.

Food minister Jyotipriya Mullick said: “We will hold a meeting with all rice mill owners on January 28 in Calcutta and tell them that they should deposit as much of the levy rice as they can before March so that the market price of paddy does not fall. If we can achieve this, the farmers will get a better price for their produce.”

This year, the state government has set a target of procuring 9 lakh tonnes of rice from the mills and 13 lakh tonnes from farmers.

As the mill owners buy paddy from farmers, government procurement of the levy rice will ensure that the demand doesn’t drop and that the cultivators get proper price and don’t have to go for distress sale, a senior official said.

However, stress on procuring the levy rice is given when the state achieves its quota of direct purchase from the farmers. This year, the government has been forced to focus more on the levy rice as large-scale direct procurement from the farmers has not taken off for lack of funds.

As the government could not set up adequate number of camps to buy paddy directly, the farmers are being forced to sell the price at a price lower than the minimum support price of Rs 1,310 a quintal.

Not getting the proper price for paddy could discourage the farmers from reinvesting in the boro season, which begins in January-end.

Birbhum agriculture marketing officer Md. Akbar Ali said the market price of paddy in the district was between Rs 1,270 and Rs 1,280 a quintal.

The government has so far set up around 200 camps across the state and procured 88,058 tonnes of the target of 13 lakh tonnes of paddy.

“Most camps were set up at the block level, not the gram panchayat level. So many farmers did not show interest in taking their produce to faraway places as it would cost nearly Rs 70 a quintal to ferry the crop,” an official said.

Senior officials said had the government not discontinued the bonus on the minimum support price, the farmers could have ferried their produce to the camps. Till 2011, the state used to give between Rs 50 and Rs 70 a quintal as bonus.

Mullick, the food minister, said the government was not in a position to pay the bonus as the amount — around Rs 330 crore — would have to be shouldered by the state. The minimum support price is paid by the Centre.