Chana procurement crosses 1 MT as mandi procurements rule below MSP

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The government’s procurement of chana (gram), which has a share of more than 48% in the country’s pulses production, has crossed one million tonne (MT) in the current rabi season (2022-23) so far compared to just 0.3 MT in the same period last year. This is on account of the bumper harvest which has pulled down mandi prices below the minimum support price (MSP).

Sources told FE that procurement of chana which is being carried out by the National Agricultural Cooperative Marketing Federation of India (Nafed) under MSP operations is likely to reach close to 2 MT by end of May.

This would give a boost to the government’s buffer stock which is used for curbing any possibility of a future spike in the prices of pulses.

NAFED procures pulses on behalf of the department of consumer affairs and department of agriculture and farmers’ welfare, under a price stabilisation fund and price support scheme.

Farmers’ cooperative so far has purchased 1.01 MT of chana in Gujarat (0.37 MT), Maharashtra (0.34 MT), Karnataka (0.06 MT) and Telangana (0.05 MT) of chana from farmers since the beginning of the month. In Rajasthan and Madhya Pradesh, key producers of pulses variety, procurement of chana has just commenced.

Rajasthan is expected to procure around 0.3 MT of chana in the current session from the farmers. In Madhya Pradesh, around 0.4 to 0.5 MT of chana is expected to be procured in the next one month or so. “At this pace of procurement, we will be purchasing close to 2 MT of Chana this session,” a government official said.

At present, the benchmark mandi prices of chana at Alwar (Rajasthan), Latur (Maharashtra), Sehore (Madhya Pradesh) and Hyderabad (Telangana) are currently ruling in the range of Rs 4,600 – Rs 4,900 a quintal against the MSP of Rs 5,230 a quintal.

“Prices are expected to rule below MSP in the coming months because of bumper output and sufficient government stocks,” Nitin Kalantri, managing director, Kalantri Food, a Latur, Maharashtra based processor of pulses said.

Current procurement of chana has bolstered the government’s buffer stock to 2.5 MT at present against the buffer norm of 2.1 MT. However, in the case of other varieties of pulses because of lower procurement, the government’s stocks are smaller – moong (0.32 MT), urad (0.03 MT), tur (0.12 MT) and masoor (0.07 MT) at present.

According to the second advance estimates for the 2021-22 season, chana output in the 2021-22 crop year (July-June) is likely to touch 13.12 MT as against 11.91 MT reported in 2020-21.

A major part of the total production of desi chana goes into further processing for producing gram flour (besan). Gram has 0.6% weightage in food inflation calculation.

India continues to impose an effective ban on imports of yellow peas (matar) which were mostly used as a cheaper substitute for desi chana for making Gram flour (besan). Officials said that the effective ban on yellow pea imports was to protect domestic prices.