APMC traders fear survival risk as Maharashtra de-notifies agri commodities

The Maharashtra government’s decision to de-notify all agriculture commodities from the mandis has sparked a state-wide protest from traders due to price differentials in the same commodities sold within and outside APMC (Agricultural Produce Markets Committee) yards.

Currently, the government is charging one per cent as service charge instead of the same mandi tax collected earlier. The service charge not only ensures smooth transaction between buyers and sellers within the APMC yards but also penalises defaulters, if any. All buyers, sellers, arhatiyas, commission agents, transporters and other intermediaries are registered with the APMC in jurisdiction to avoid any discrepancies in transactions.

However, the government of Maharashtra on October 25 issued an ordinance de-notifying all agriculture commodities effective immediately, which means farmers and traders are free to sell their produce within and outside the APMC yards. The state government in July 2016 had de-notified fruits and vegetables, thereby allowing farmers to sell their produce to buyers within or outside APMC yards as per their choice for better realisation.

“Traders within the APMC would not be able to compete with their counterparts outside the mandi due to the one per cent service charge paid by the players inside the APMC yards. They would either have to sell their produce at higher prices or compromise their profit margins. Considering the seriousness of the issue, we are in talks with the government to re-consider the decision,” said Mohan Gurnani, President of the Federation of Associations of Maharashtra.

While announcing the government’s decision, the state Agriculture and Marketing Development Minister Sadabhau Khot said, “There will be no revenue loss to the government as commodities were sold outside mandis even today. Also, market committees would continue to function. The committee charge 6 per cent of cess without providing any service to farmers.”

Also, the state government has decided to declare APMC mandis a market of national importance (MNI) which receives over 30 per cent of agriculture produce from a nearby state. Currently, Azadpur mandi in Delhi is the only such MNI exists in India.

The government of Maharashtra had in past shifted APMC from Mumbai to Navi Mumbai ensuring all possible supports to traders and farmers there. In addition to good infrastructure, the state government assured traders to have smooth transition.

“We helped the government in de-congestion of the city as all traders along with their business units shifted outside the city. Now de-notification of agriculture commodities would make commodities cheap outside mandis,” said Gurnani.

Meanwhile, the de-notification of APMC Act or mandatory selling of agricultural produce to mandis is set to make life difficult for traders.

“Traders may face problems in terms of payment. While farmers may see buyers running out after picking up the inventory, sellers might witness payment defaults outside the APMC yards. Despite traders pay fee a nominal fee within APMC yards, transactions are fully channelized. The APMC works smoothly in a transparent manner with complete track on entire eco-system. Hence, earlier system is workable,” said Deepak Keshavrao Vijaykar, Secretary, APMC Amravati.

The impact would be severe on producing mandis like Lasalgaon compared to consuming mandis like Vashi near Mumbai. Farmers may be prompted to save mandi fees, handling and other administrative expenses by bringing their produce to mandis.

“There will be no change in trading system. Farmers and traders would continue to bring their agricultural produce to mandis. There is a different kind of trading environment within mandis which will not be available outside,” Krishnat Vasantrao Patil, President, APMC Kolhapur.