Ukraine crisis: Mustard farmers on wait and watch mode

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Basant Ram Sharma, a farmer from the Muruwara village of Bharatpur district in Rajasthan, who sowed mustard in 6.5 hectares this season, has been visiting the mustard mandi at this hub of country’s trade to assess the prevailing mandi prices. While Sharma has just commenced harvesting of his mustard crop, he is also keeping a close watch on the Ukraine war. How the conflict unfolds is set to influence farmers like Sharma as they take decisions on whether to sell crops in the mandis or hold these for a few more months in anticipation of better prices.

While current prices at the mustard mandi is around Rs 6,400 per quintal which is much above the minimum support price (MSP) of Rs 5,050 per quintal for current season, farmers like Sharma are holding on to their stocks even though the peak arrivals time is set to commence from March 15.

“I will wait till mandi prices reach Rs 7,500 per quintal and then sell my harvest,” Sharma told FE. He anticipates a harvest of around 30 quintal per hectare which he will store for the time being and bring into mandi gradually.

A number of farmers FE spoke to also confirmed that they are holding on to their stocks in anticipation of higher prices despite an anticipated bumper mustard production of 11.45 million tonne in 2021-22 crop year (July-June).

India, which imports about 55% of its total domestic requirement of edible oil depends on Ukraine for sunflower, which had 14% share in total edible oil import basket in 2020-21. Because of supply disruption due to the conflict between Ukraine and Russia, farmers anticipate that higher demand for mustard, which will push up prices further.

“Farmers are closely following the Ukraine-Russian conflict and they will be cautious releasing the stocks in the market,” Krishan Kumar Agarwal, president, Bharatpur Oil Millers Association, said.

According to traders and commission agents at the mustard mandi, during March 15 – April 30, around 55-60% of the mustard harvest arrive. However, farmers continue to bring in their produce in subsequent months although in a smaller quantity.

The arrivals at the dedicated market yard for mustard is currently witnessing a daily arrival of around 6,000 quintal by farmers, which is likely to cross 10,000 quintal daily in the coming weeks.

According to officials, Bharatpur district is the largest mustard growing division in Rajasthan with a contribution of more than 48% in the total state’s output. Other key mustard growing districts include Alwar, Sriganganagar, Sawaimadhopur and Jhunjhunu. In terms of area of cultivation of mustard, Rajasthan has a share of 45% while key producing states have Uttar Pradesh (12%), Madhya Pradesh (12%) and Haryana (9%) share in the current season.

According to the ministry of agriculture, in the rabi sowing season (2021-22), oilseeds such as mustard, groundnut and sunflower were planted in 101 lakh hectares (lh), which was 22% more than previous years. Of these, the sowing of mustard increased by 24% to 91 lh compared to close to 73 lh reported a year ago.

India produces about 45% domestic edible oil consumption in which, mustard has a highest share of 39%, followed by soyabean (24%) and groundnut (7%). The edible oil imports is likely to be Rs 1.5 lakh tonne in 2021-22.