Nafed halts mustard sale as new crop arrives

The National Agricultural Cooperative Marketing Federation (Nafed), the country's main mustard carrying agency, has halted sales of mustard from today. However, prices may not be impacted as fresh stocks have started arriving in various mandis.

"We have stopped sale of mustard from today as new crop has started arriving in the market. We currently have a stock of 8.3 lakh tonne", said Alok Ranjan, managing director of Nafed after the inter-state conference on price support scheme for rabi crops.

The federation is hopeful of procuring 20 lakh tonne mustard this year at a minimum support price (MSP) of Rs 1715 a quintal. "We will ask a credit of Rs 1000 crore from the government to begin timely payments for the procurement," he added. Last year, there were cases of payment delay to farmers in states of Rajasthan and Haryana.

The federation will be able to procure sizeable quantities as the MSP is significantly higher to the market price of Rs 1600-1650 a quintal. However, the federation will need to spend about Rs 3600-3700 crore for procurement and storage of 20 lakh tonne, Kailash Jyani, additional managing director indicated.

The federation had procured 21 lakh tonne mustard in 2005-06 rabi season (at an MSP of Rs 1715 a quintal) and 20.93 lakh tonne in 2004-05 (at an MSP of Rs 1700 a quintal). Of late, Nafed had been selling mustard at a price range of Rs 1650-1700 a quintal.

The agriculture ministry's estimate for rabi rapeseed-mustard production is 7.56 million tonne, down 7 per cent from last year's 8.13 million tonne. Farmers in Rajasthan, Uttar Pradesh and Madhya Pradesh have diverted land from oilseeds to crops such as wheat and chana owing to bullishness in these commodities last year.

Earlier at the conference, agricultural officials of Rajasthan and Uttar Pradesh indicated the possibility of damage to the rabi crop owing to unseasonal rains over the last few days. However, the extent of damage is yet to be quantified.