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Procurement

Uttar Pradesh paddy purchase outstrips its storage capacity as procurement continues

The paddy will be purchased till the procurement season ends and they may request the Food Corporation of India to move the surplus from Uttar Pradesh

PUBLISHED ON JAN 12, 2021 10:47 AM IST

The Uttar Pradesh government has purchased more paddy than the state’s storage capacity even as the procurement will continue till February, officials aware of the matter said. The procurement will follow the purchase of wheat from April, they added.

Food and civil supplies commissioner Manish Chauhan said the paddy will be purchased till the procurement season ends and they may request the Food Corporation of India to move the surplus from Uttar Pradesh. “…we may also think of distributing rice under the public distribution system for two months at one go to create additional space,” he said.

Uttar Pradesh distributes 8lakh metric tons (LMT) of subsidised rice monthly.

Officials said over 57 LMT of paddy worth Rs10,274 crore has been purchased from 1.1 million farmers so far. The target for purchase was 55 LMT. They added the final procurement is likely to around 70 LMT. Around 45 LMT of paddy was purchased during the corresponding period last year.

Chauhan said overall 56.6 LMT paddy was purchased last year. “…[It] was the highest-ever and this year the paddy purchase has already broken last year’s record.”

Uttar Pradesh’s total storage capacity is around 50 LMT.

An official, who spoke on condition of anonymity, said they have to store paddy scientifically and unlike wheat, rice cannot be stored in the open. “We are fast running out of safe storage capacity and the government will have to find a short-term solution immediately.”

Chauhan said the Minimum Support Price (MSP) that the government is offering is much higher than what the farmers are being offered in the open market. “…because of this, most farmers are trying to sell their paddy to the government at MSP,” Chauhan said.

Officials said the government has also undertaken aggressive procurement in view of the protests against the three farm laws enacted in September to liberalise the farm economy. The protesting farmers say the laws will lead benefit big corporations and erode the MSP system.

Officials said the difference between MSP and the market price for paddy is around 400-500 per quintal in Uttar Pradesh. “Earlier, the difference used to be nominal due to which many farmers preferred to sell their produce to private players even if the MSP was a little higher to avoid inconvenience involved in taking the produce to government purchase centres,” said a second official.

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