Decision on wheat MSP in a fortnight

The government is likely to take a decision on the minimum support price (MSP) of wheat in the next 15 days, while it may enter the open market to curb the rising prices of non-basmati rice.

“The issue (wheat MSP) will go to the Cabinet ... We will take a decision in the next 15 days,” Agriculture and Food Minister Sharad Pawar said on the sidelines of a global seminar on wheat.

The Commission on Agricultural Costs and Prices (CACP) has recommended a wheat MSP of Rs 1,080 a quintal for the current rabi season against Rs 1,000 a year ago.

Asked about the rising price of non-basmati rice in the last 15 days, Pawar said: “We are keeping a close watch. For some of the states where prices have gone up, we might release additional quantities. We might enter the open market also to release a limited quantity.”

The minister ruled out an early decision on imposing import duty on edible oils as also lifting the ban on exports of non-basmati rice.

“These are the items which will go to the (empowered) group of ministers, which, I think, will meet after three weeks ... So there is no early decision,” Pawar said.

The government is assessing the situation of paddy and oilseed cultivation, particularly in Madhya Pradesh, Maharashtra and a few other states, he said, adding that prices of oilseed are still ruling above the MSP.

The empowered Group of Ministers (eGoM) on food, which met early this week, had deferred the decision to impose import duties on edible oils and also stated that the ban on non-basmati rice would continue.

Some edible oil manufacturers had demanded re-introducing import duty on edible oils in view of decline in their prices in global markets. They said that cheaper imported oils would hit Indian farmers.Meanwhile, the total stock of rice stood at 8.47 MT as on September 1. Government procured a record 28.5 MT of rice in 2007-08 on back of bumper production of 96.43 million tonnes.

Wheat stock as on September 1 stood at 23.26 MT. The Food Corporation of India — the nodal agency for foodgrains procurement and distribution — purchased record 22.6 MT this year, helped by higher MSP of Rs 1,000 a quintal. The country produced a record 78.4 million tonnes of wheat in 2007-08 and government is aiming to surpass that figure by bringing in more area under the crop.

NewsWire18 adds: The government seems undecided so far on restructuring import duties on edible oils and whether to allow their export. Global prices of oilseeds are currently weak but local rates are still hovering above the minimum support price (MSP).

The empowered Group of Ministers on prices, which deferred a decision on the issue after a two-hour meeting on Tuesday, will now meet again in three weeks to reassess the situation, Agriculture Minister Sharad Pawar said on Thursday.

“We are just assessing the crop condition of paddy and oilseeds...But prices of oilseeds are still above MSP. The GoM will now meet in three weeks,” Pawar told reporters on the sidelines of a wheat seminar.

Earlier this week, Pawar had said the ministers’ panel would consider imposing import duty on crude edible oils and restructure duties on other oils to bail out the industry and farmers hit by low prices.

With global prices of edible oil declining sharply over the past several weeks, there are apprehensions that the country will be flooded with cheap imports of palm oil from Malaysia and Indonesia.