Centre mulls grade-based MSP

Higher pricing for durum wheat likely

The government is considering grade-based fixation of minimum support price (MSP) for wheat in coming years to ensure farmers get a premium for high quality produce, a top government official said Friday.

The proposal is to fix MSP for 'durum' wheat at Rs 20-30 higher than other varieties due to high protein levels and good cooking properties.

In India, the government fixes minimum support price for farm commodities and procures them at the MSP in the event of market rates falling below or hovering around that price to firm up sentiment and ensure adequate returns to the farmers.

In wheat, irrespective of market prices, government is the largest buyer, purchasing more than 20 per cent of the produce at the MSP to run a public distribution system and meet exigencies.

"Farmers producing high quality wheat must get a premium for their efforts. To encourage its cultivation we are considering a price differential of Rs 20-30 per 100 kg for them through a grade-based MSP instead of the current practice of a uniform MSP irrespective of variety or quality," the official said.

This will be more in tune with the times when futures' trading is gathering pace, there are efforts to integrate domestic trade with global markets and quality is an important criterion in business deals, he said.

The matter had been discussed at length with both India's apex farm research body, Commission on Agricultural Costs and Prices, and Karnal-based Directorate of Wheat Research.

DWR Project director Jag Shoran confirmed that the research organisation's views have been solicited on the proposed grade-based wheat MSP fixation and it recommended a premium for durum wheat, which is grown mostly in central India.

He said of the total annual Indian wheat output of around 75 million tonne, only two mt were of durum quality and its production will get a boost if higher support price is notified.

Its high protein content and gluten strength make durum wheat good for making pasta, macaroni, bread and even porridge, he said.

For pasta products, hard and strong wheat with more than 12.5 per cent protein and more than 7 parts per million B-carotene content is required.

Durum wheat with strong gluten characteristics is ideally suited for the purpose as it forms strong, non-sticky doughs needed for pasta processing and, in general, tends to produce products with superior cooking characteristics.

Traders also feel it will be a sound business proposition to produce more durum wheat, which is much in demand worldwide, particularly in pasta-consuming European nations.

Global annual durum output is estimated at around 35 mt in the overall wheat output of over 620 mt. Nearly 10-12 mt of durum wheat is traded worldwide but Indian produce is primarily consumed domestically.

Indian wheat falls into five broad categories of standard mill quality, premium, soft bread or biscuit wheat, durum and dicoccum based on chemical quality and physical purity.

As of now, commodity trade has accepted only the first two classes and this is adversely effecting cultivation of quality wheat like durum and dicoccum in the country, the government official said.

Shoran said relatively warm dry climate in rain-fed areas of central India rather than wet irrigated plains of Punjab and Haryana were suitable for cultivating durum wheat.

Its cultivation in low temperature, wet and cold climatic conditions would only result in leaf blight or drying of leaves and diseases like yellow-berry, which involve their stripling or spotting.

Traders said its accelerated cultivation in central India, could make the region a major wheat-exporting hub.

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Thrust on quality

• The government proposes to fix MSP for 'durum' wheat at Rs 20-30 higher than other varieties due to high protein levels
• It is also considering a price differential of Rs 20-30 per 100 kg for them through a grade-based MSP instead of the current practice of a uniform MSP