Rs 1909 cr sop for Nafed over mustard losses

National Agricultural Cooperative Marketing Federation (Nafed) has been given Rs 1,909.66 crore for meeting losses incurred on procurement of mustard.

The amount was approved by the Cabinet Committee on Economic Affairs in a meeting today. The Federation has also been awarded additional fund of Rs 289.86 crore for 2007-08.

The CCEA also gave Nafed an ex-post facto approval for disposal of surplus mustard in seed form and as processed mustard oil in the domestic market of 12 lakh tonne from December 2006 to February 2007. Of this, 8 lakh tonne has been sold. The federation is left with a stock of 8.5 lakh tonne.

"We had procured mustard at the minimum support price (MSP) announced by the government, while market prices had remained low and we incurred losses on sales. In addition, there were some carrying costs. The amount will make up losses incurred by us," said Alok Ranjan, managing director of Nafed.

In 2005-06, the federation had procured about 20.93 lakh tonne of mustard at a minimum support price of Rs 1,700 a quintal. It procured about 21 lakh tonne mustard this year at an MSP of Rs 1,715 a quintal.