Rajasthan levies stock limit on pulses

No exemption for registered warehouses; chana prices may decline as traders need to sell excess holding

The Rajasthan government has imposed a limit on stockists that requires them to sell any holding of over 250 tonnes of pulses in the market.

In a notification on June 22, the state government issued stockists a 15-day deadline to bring down their holdings to 250 tonnes. The stock limit will remain till September 30, 2015.

The notification specified that for holding even 250 tonnes of pulses, traders needed a licence from the government. The state government ignored an October 2014 recommendation from the Centre exempting warehouses registered with the Warehousing Development and Regulatory Authority from stock limits.

“We have provided 15 days to traders to comply with the norms. Raids and seizures will start after the due date,” said Parth Sarthy, supply officer for Bikaner, a district that has around 40 pulses processing mills.

Chana prices have declined by 15 per cent since June 1 to trade at Rs 4,167 a quintal for near-month delivery on the National Commodity and Derivatives Exchange. Experts forecast a further decline of Rs 200-300 a quintal in the near term due to additional supplies.

 

Traders had built chana stocks in anticipation of a price hike due to supply shortages. They will have to sell their excess holding at the prevailing market price, possibly at a loss. Unseasonal rainfall in the rabi harvesting season damaged crops and pulses price started firming up. The government does not procure pulses despite announcing minimum support prices every year.

“We urge the government to withdraw the notification. Traders are reeling under severe losses due to falling prices. If not withdrawn, our protest will intensify,” said Babulal Gupta, president of the Rajasthan Vyapar Maha Sangh, the parent body of all traders, stockists and warehouse keepers in the state.

 

Rajasthan, according to sources, is the largest processor of pulses in India. Traders and stockists believe the stock limit is aimed at segregating warehouse keepers from registered ones and at creating a distinction between regional and national players.

“There is an adequate quantity of pulses in Rajasthan, which supplies to other states. Prices have not moved abnormally high. Stock limits will extradite huge quantities of pulses to other states. The government is harassing traders. The limit should be removed immediately,” said Babulal Goyal, a Bikaner-based trader.

According to an estimate, traders hold around 3 million bags (100 kg each) of pulses in Rajasthan. Pulses prices have declined by Rs 100 a quintal in the last couple of days due to oversupply.