Irked by the free fall in soybean prices this harvesting season, farmers in Madhya Pradesh have started a mild protest across spot mandis demanding from state authorities to raise purchase price of the oilseed.
Soybean in spot mandis is traded between Rs 3000 – 3100 a quintal, substantially higher than the minimum support price (MSP) fixed by the Union Agriculture Ministry at Rs 2240 a quintal ahead of the last kharif sowing season. But, farmers have demanded the state authority to devise a formula through which they can fetch at least Rs 500 a quintal more. State authorities, however, denied market intervention so far.
Farmers, however, are in the process to co-ordinate with each other to come together on 21st in Bhopal for a massive protest. Soybean price has fallen by 35% in the last three months.
The issue, however, is likely to take a political turn being soybean one of the main drivers of the state economy. A number of crushing mills have set up oil extraction units to transport refined soy oil, soy meal and other edible grade processed soya food that fetches massive income to the exchequer.
The major concern of protesting farmers is the squeeze in their income due to a huge spurt in raw materials including labour, fertilizer and input. For example, farmers bought soya seed at Rs 4400-4500 a quintal during kharif sowing season. But, at the time of harvesting the price plunged to the lowest level at Rs 2600-2700 a quintal about a week ago.
Although, the price has increased a bit since then due to lower supply due to the ongoing inauspicious shraddh period, experts believe the commodity to decline in coming days with farmers intensifying harvesting of the standing crop after a week. Labour cost has also increased along with cost of fertilizer and transportation to add the overall input cost at least by 30-40%.
Currently, soybean arrivals are estimated to remain at 600,000 bags (1 bag = 100 kgs) across the country’s spot mandis of which around 400,000 bags could be in Madhya Pradesh alone. But, arrivals may go up to 10 – 11 lakh bags with harvesting peaks up, said Rajesh Agrawal, Spokesperson of Indore-based The Soybean Processors Association of India (SOPA).
Soybean output, according to a report by Nirmal Bang, is expected to set the new record at 11 million tonnes as against 10.1 million tonnes reported during last year. SOPA, however, estimates total soybean output at 12.6 million tonnes on better crop prospects on timely revival of monsoon.
Acreage under soybean is estimate to rise by 3.76% to 106.94 lakh ha in 2012 as compared to 103.06 lakh ha in the previous season, said Ankita Parekh, Research Analyst with Nirmal Bang, a Mumbai-based commodity broking firm.
The year of 2011-2012 proved to be an excellent year for soybean growers as prices hit the roof rising by almost Rs 1500 per quintal in just two months. A tight supply and demand scenario both in domestic and international markets turned the sentiments in favor of the bulls.
Weather irregularities added concerns to the already tight domestic scenario. Further, improved meal demand from India at a time of thin supplies augmented the price rise.
