Wide disparities in agri-marketing regulations have resulted in fragmented markets across states. The new farm bills aim to change this but the jury is still out on whether it will have the intended impact.
On 26 September, government procurement of food crops commenced across the country, five days in advance, following the enactment of three contentious farm bills. Under the new policy regime, farmers need not sell their produce through designated markets, and can sell to whoever they want to.
The same week, reports emerged that farmers from Uttar Pradesh wanting to sell their produce in Karnal, Haryana, were stopped at the Haryana border. Later, the Haryana government clarified there was no law barring farmers from other states from selling their produce in Haryana, and they could do so after registering on a portal. This begs the question, why would farmers from one region want to sell their produce elsewhere?
Monthly data collected on wholesale prices across 122 centres by the ministry of consumer affairs, food and public distribution shows wide geographical disparity in prices. We studied this data for six key agricultural commodities in 2019, covering foodgrains, pulses and vegetables. Three commodities (rice, wheat and tur dal) were among the 23 for which the government sets a minimum support price (MSP). The other three (potato, onion and tomato) didn’t have MSP support. The largest price variation was seen for vegetables, where trade is mostly unregulated and there exists no government procurement.
Source: livemint
