Nafed to procure fresh mustard stock via price support system

The National Agricultural Cooperative Marketing Federation of India (Nafed) is gearing up to procure mustard, under the Union government's price support system, from April.

A Nafed official said, "We have started shifting stocks out of Rajasthan to Punjab and Uttar Pradesh via the rail route to make space for the next crop, scheduled for harvest from mid-March. Five rakes (about 10,000 tonne) have been moved out by now, and we have written to the Union railway ministry to give us access to at least two rakes (4,000 tonne) per day to transport mustard."

Rajasthan is the largest mustard-producing state in the country. The next mustard crop is likely to be better than last year.

According to the state government estimates, mustard output in current rabi (October-March) will be about 40 lakh tonne compared with 35 lakh tonne in the last rabi season.

The state is keen to take maximum benefit from the Centre's decision to raise the minimum support price for the current rabi by Rs 15 to Rs 1,715 per 100 kg.

Thus, the state has asked Nafed to procure about 20 lakh tonne in the next marketing season (April-March) compared with 14 lakh tonne in the current season. At present, the available space in the state can stock only about 1.5 lakh tonne of grain.

The state has asked Nafed to shift the latter's huge mustard stock, about 12.5 lakh tonne, of its total stock of 18.66 lakh tonne.

Last season, Nafed had procured 20.91 lakh tonne at the minimum support price of Rs 1,700 per 100 kg under the Centre's price support system.

"Further, we are in talks with the Central Warehousing Corporation, which has space for about 6 lakh tonne grain. We may use that space and our contracted mills to process seed to oil have also begun work," the official added.

Earlier this week, in his visit to Rajasthan, the Union agriculture minister Sharad Pawar is said to have asked the state to offer tax relief towards mustard procurement, the official said. "This will help reduce the federation's carryover cost, which is eventually borne by the Centre as a subsidy," he added.

The state has given relief in purchase tax from the current 4 per cent to 1 per cent till March 15, but this is not going to help the federation in the procurement next season, which begins in April.

At present, the spot market price is about Rs 1,570-1,600 per 100 kg, and Nafed is selling about 3,000 tonne mustard via daily tenders.

Six mills begin processing

About six of the total 34 contracted mills (by Nafed) have begun processing mustard to produce oil, a senior official of the federation said.

"The total crushing capacity of the operating mills is about 300 tonne per day. We expect the remaining mills also to begin processing in a week and in daily crushing capacity of about 1,200 tonne of mustard," the official added.

Last month, the federation had contracted about 34 small oil mills in Sriganganagar and Jaipur to process about 4 lakh tonne of mustard at a charge of Rs 132.50 per 100 kg. The total crushing exercise is expected to produce about 1.3-1.4 lakh tonne of mustard oil, which will be sold by revising the Nafed brand.