Govt discusses farmers' demand to hike cotton MSP

The Centre today discussed the issue of falling cotton prices below the minimum support price levels at some places as well as farmers' demand to raise the support price for this year to protect the growers' interest.

The government has already fixed the minimum support price (MSP) at Rs 4,100 per quintal for long staple cotton and Rs 3,800 per quintal for medium staple cotton for the 2015 -16 marketing year.

"We called a meeting to discuss the cotton issue. Cotton prices have fallen in the country and there is a demand from farmers that MSP should be increased further or bonus should be given," Minister of State for Agriculture Mohanbhai Kalyanjibhai Kundariya told reporters after the meeting.
 

Senior officials from agriculture and textile ministries as well as the chairman of the Commission for Agricultural Costs and Prices (CACP) were present at the meeting.

Kundariya said, "All cotton-growing states are demanding increase in MSP. We will take up the issue at a higher level. With regard to bonus, the state governments are free to announce it to protect the interest of farmers."

At the meeting, the state-owned Cotton Corporation of India (CCI) was asked to open procurement centres at the earliest at places where prices have fallen below the MSP.

CCI, which has started procurement in Andhra Pradesh and Telangana, aims to procure about 20-25 lakh bales (of 170 kg each) in the 2015-16 marketing year, which runs from October to September.

Last week, CCI Chairman and Managing Director B K Mishra had said: "Cotton rates have not fallen below the MSP in all states. It would definitely procure cotton from those places where prices are ruling below the support price."

Cotton prices, which were ruling at Rs 4,800 per quintal in July 2014, have declined to Rs 4,300 per quintal in October, but slightly higher than the current MSP.

Cotton prices are ruling lower in the wake of poor export demand, especially from China, traders said.

According to the Cotton Advisory Board, India's cotton output is estimated to be lower by 15 lakh bales at Rs 365 lakh bales in 2015-16.