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Paddy Prices Have Crashed Below MSP in Many States -Subodh Varma

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This is because the new farm laws have already paralysed mandis and traders are buying up paddy at lower prices.

Even as farmer protests against the three new farm laws entered the 17th day, information available for mandis (wholesale markets) shows that a large proportion of this year’s paddy crop is being bought from farmers at much below the government declared Minimum Support Price (MSP). This could be attributed to the looming prospect of effective scrapping of MSP and freedom now available to traders to buy at whatever prices they want.

According to daily data available on the online portal AgMarknet run by the agriculture ministry, paddy has been bought by traders for prices ranging from as low as Rs.1,150 per quintal to Rs. 1,868, which is this year’s MSP for common paddy. Data was available for 292 grain mandis across 15 states. The kharif marketing season starts in October each year and paddy arrivals in mandis goes on for three months, as regions where harvesting is done later, come to markets later.

As the table below shows, some of the major states where a significant proportion of the paddy crop was sold below MSP were Uttar Pradesh (47% crop sold below MSP), Gujarat (83%), Karnataka (63%), and Telangana (60%). In Tamil Nadu, the total amount of paddy sold has not been completely estimated, at least on this portal.

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