BHOPAL: Farmers are selling wheat in distress in Madhya Pradesh after the government-owned Food Corporation of India suspended its purchase last week. As a consequence, wheat prices crashed to Rs 1,400 a quintal (fair average quality) against its minimum support price (MSP) of Rs 1,600 a quintal.
A senior FCI official attributes the plight of wheat farmers to three primary facts. One, in the beginning of the procurement season, many farmers did not register themselves with FCI amid expectations that the previously prevailing rate of Rs 1,800 a quintal will continue for the entire season. However, because of the bumper crop, wheat prices crashed. Hence, the unregistered farmers did not have any option but to sell to private traders.
Secondly, the state government came out with a provision under which wheat sold to government agencies above 50 quintals would result in cancellation of such farmers’ ration card from the BPL (below poverty line) category. It appears that many large farmers have got ration card under the BPL category. Hence, farmers chose to sell up to 49 quintals to FCI and the remaining large quantities to private players. As a result, there was an oversupply of wheat in private mandis which caused the price of white to crash.
