Informist, Monday, Feb 26, 2024

MUMBAI – The continuous fall in mustard seed prices in recent weeks is a concern for farmers as well as for the government, which should start procuring the oilseed at minimum support prices, Dr P.K. Rai, director of ICAR-Directorate of Rapeseed-Mustard Research, Bharatpur, said.

Mustard prices are currently at 5,325-5,350 rupees per 100 kg, below the minimum support price of 5,650 rupees per 100 kg. In the same a year ago, the prices were in the range 5,500-5,525 rupees. Increasing arrivals of this rabi oilseed have pushed prices down, said traders.

Farmers and traders expect prices to remain subdued in the coming months as arrivals rise. “Prices will continue to fall as there is large production of mustard this year as compared to last year,” a Jaipur-based trader said. “The production of mustard has increased but people and agencies should be there to procure the produce,” Mahesh Sameriya, another Jaipur-based trader, said.

Another reason for the low prices is the quality of new crop. “Mostly, there are arrivals of rain-damaged crops which have high moisture content and are not usually preferred by oil millers,” Sameriya said.

In Rajasthan, arrivals were up by 10,000 bags (1 bag = 50 kg) at 260,000 bags on Friday. Arrivals across the country were 700,000 bags on Friday, according to Marudhar Trading Agency. Mustard prices in Kota, Rajasthan, were at 5,000 rupees per 100 kg, with arrivals pegged at 12,000 bags as on Friday, Sameriya added.

“Mustard production is good this year, but prices could fall more, so agencies like National Agricultural Cooperative Marketing Federation of India Ltd and others should procure more and more,” B.V. Mehta, executive director, The Solvent Extractors’ Association of India, said.

According to Rai, the government is planning to purchase mustard this season itself through various agencies like NAFED. “The situation is not so bad, the production this year is good, so the government will do something very soon,” Rai said. The government may supply mustard oil through public distribution system, he suggested.

“Around 1996-97, the import duty on palm oil was around 15%, now it has gone down to 5.5%. This is definitely affecting the domestic mustard oil as well as oilseeds prices,” Kishor Viradiya, president of Saurashtra Oil Mills Association, said.

Low prices of mustard may force farmers to shift to other crops such as wheat, chana and soybean, curtailing output next year, he said. Hence, the Centre should come up with policies that encourage mustard production. Right now farmers are discouraged by the falling prices and are planning to shift to other crops as they are not getting what they deserve, he pointed out.

“The government should come up with a solution of a permanent minimum support price for mustard, so that even if there is bumper production, the Centre should buy at the same price from farmers. Mustard farmers only need protection for their crops.”

Mustard acreage across India was at 10.0 mln ha as on Feb 1, up 5% from 9.6 mln ha in the previous year, as per the survey cited by the Solvent Extractors’ Association. The mustard area in Uttar Pradesh rose to 1.8 mln ha compared with 1.4 mln ha last year. Similarly, the area under mustard in Madhya Pradesh increased to 1.4 mln ha from 1.3 mln according to the survey.

India’s mustard production in 2023-24 (Oct-Sep) is estimated at 11.9 mln tn from 9.3 mln ha, according to the Foundation for Agrarian Studies, New Delhi. The higher estimate is due to beneficial cold weather conditions for rabi crops in Rajasthan, the major mustard growing state in India.