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Centre may let millers process groundnut; supply oil via PDS

Peanut Market News May 29, 2018

Centre may let millers process groundnut; supply oil via PDS

To dispose groundnuts purchased under minimum support price (MSP) scheme in Gujarat, the Centre is considering allowing millers to crush the oilseeds on jobwork basis to supply oil through the public distribution system (PDS).

It has allowed crushing of 1 lakh tonnes of groundnut stored in National Agricultural Cooperative Marketing Federation of India (Nafed) warehouses across Gujarat.

"This is on trial basis as for the first time in India, groundnut is being processed under price support scheme (PSS) stock," said a top official of Nafed.

Warehouses full

Nafed had procured about 8.3 lakh tonnes of groundnut in Gujarat, where farmers had harvested a bumper crop of 32 lakh tonnes during 2017-18 kharif season. Besides, Nafed is saddled with a carryover stock of 50,000 tonnes. These are all stored in about 800 warehouses.

Nafed has initiated discussions with the agencies to work-out the detailing of tendering process. "There will be separate tendering process for this. We are taking inputs from various agencies including Junagadh Groundnut Research Institute under ICAR. After receiving inputs from them, we will devise our own methodology for tendering," said the Nafed official.

On Monday, Sameer Shah, president, Saurashtra Oil Mills Association (SOMA), wrote a letter to the Gujarat Agriculture Minister R C Faldu demanding State support for utilising the stored groundnut for crushing and processing.

"We have requested the government to allow oil millers and processors to take up jobwork for crushing and processing for the government. The edible oil and peanuts produced from this can be utilised for mid-day meal schemes and sold under PDS. There is a need for proactive measures from the government," said Shah, after a meeting held with the officials of State government, Nafed and Oil industry last week in Gondal near Rajkot.

Oilcake market

Oil millers said this will also make groundnut oilcake viable. "Unlike other oilcake exports, which have 7 per cent export incentive, there is no incentive for groundnut oilcake exports. We have demanded export incentives, which will lift the cake prices and as a result improve the groundnut prices too," he added.

Gujarat witnessed bumper crop of 32 lakh tonnes of the oilseed in 2017-18 kharif season, against 29 lakh tonnes in the previous season. The government started procurement under a price support scheme (PSS) at the minimum support price (MSP) of ?4,450 a quintal. Including the State Government bonus of ?50 , the procurement price was ?4,500, against then market prices of ?3,250.

Prices hit

When Nafed started to auction the stocks before the onset of monsoon groundnut selling price settled around ?2,900-3,000 in the initial tenders, about 33 per cent lower.

"The more delay we face in disposing the quantity, the greater will be the loss as we are approaching towards monsoon which will spoil the stock," said Vaghjibhai Patel, chairman, Nafed.

So far, Nafed has sold about 1.13 lakh tonnes from 2016-17 crop, while no stock from the 2017-18 crop could be sold.

Source: https://www.thehindubusinessline.com/economy/agri-business/centre-may-let-millers-process-groundnut-supply-oil-via-pds/article24017523.ece


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