Centre to buy 1 lakh tonnes potato from UP farmers at Rs 4,870 per tonne

This is being done to arrest the sharp fall in prices in UP in the wake of a likely bumper crop

The Centre on Tuesday decided to purchase around 100,000 tonnes of potatoes from Uttar Pradesh farmers in the 2016-17 season at Rs 4,870 per tonne to arrest the sharp fall in prices.

According to an official statement released on Tuesday, the government will give an extra Rs 1,217.60 per tonne or actual whichever is less for overhead expenses, such as transportation charges, mandi tax and godown charges to farmers.

A decision to procure potato in UP under the Market Intervention Scheme (MIS) has been approved by the Union Agriculture Ministry. The MIS will be implemented by the state agency, the statement added.

Potato rates in Uttar Pradesh, the leading producer, have crashed in the wake of a likely bumper crop.

As per trade data, the wholesale price of potatoes have fallen below Rs 4 per kg now as against 10-12/kg in the year-ago period.

Earlier, the state had decided to purchase a record eight million tonnes of wheat from farmers in 2017-18 crop marketing year and also announced a mega around Rs 36,000 crore loan waiver for farmers.

Meanwhile, on potatoes, the official statement said that the procured stocks will be disposed off in the open market to ensure maximum realisable price.

If necessary, this can also be sold to processing units within the state. The state agency would also make efforts to export the procured potatoes after processing.

In order to avoid recycling, the stock would not be sold in the same market rate from where it has been procured during the period of the scheme.

However, if the prices are better it can also be sold, locally, it said.

Purchase centres or areas will be decided by the state government in consultation with the state agency.

Potato will be purchased from the cooperative societies, farmers' organisations or directly from growers to eliminate the possibility of middlemen taking advantage of the scheme.

The state government will ensure that the produce is purchased from genuine farmers only, the statement added.

"Barter payments or payments in kind to farmers for procurement won't be allowed," it noted.

Payment to farmers as far as possible will be made through non-cash transaction and receipts for sales must be through banking channel only, preferably through Demand Draft.

The country's total potato output is also expected to be bumper at 49 million tonnes in 2016-17 crop year.

In a related development, the state government in a cabinet meeting directed all sugar mills to clear all of their current year's dues within 14 days and old dues within 120 days.

"Legal action will also be taken against sugar mills if them fail to make payments," State Minister Srikant Sharma said.

The UP minister also claimed that outstanding dues of the cane farmers for the sowing seasons 2014-15 and 2015-16 have been already been paid.