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In Gujarat, no proof of higher price for farmers in trade outside APMCs

Peanut Market News October 26, 2020

In Gujarat, no proof of higher price for farmers in trade outside APMCs

In Gujarat, no proof of higher price for farmers in trade outside APMCs. While Gujarat became one of the first States to notify and implement the Centre's recently-enacted farm trade facilitation laws, farmers in parts of the State are still hesitant to lap up the reforms in APMC trade. Market sources say that in trade outside APMC there has not been any increase in price for farmers.

“Farmers usually follow the prices derived from the auctions at APMC. However, in cases of trade outside APMC, there is no auction, hence there is no proof to say that the prices are competitive. The only impact of the new trade laws in on commission agents as they are losing their buisness,” said Atul Kamani, President of APMC Commission Agents’ Association in Rajkot.

Trust, transparency

On Friday, Jagdish Rangalia, a farmer in Halvad of Morbi district in Saurashtra, was covering his truck-trolley loaded with about 20 quintals of cotton crop with plastic covers due to rain forecast in the region. “I would rather wait for weather to clear and take my crop to APMC than sell it to a private party or a trader outside APMC. Especially, when we hear cases of fraud or delayed payments, fear increases. APMC remains our preferred destination to trade,” said Rangalia, adding that the only advantage of selling outside APMC is savings on transport and labour costs.

“But there is a greater risk on payments as one in ten buyers try to play tricks with farmers and cheat with false promises on payments. There are issues of delay in payments, cheque bounce, etc. A farmer has to become a real recovery agent to get his due,” he said.

Another farmer, Hansrajbhai Patel from Jamnagar district believes that APMCs are a trusted place for transparency in prices. “About 50 per cent of my cotton crop is damaged due to excessive rains last month. We can’t think of selling our remaining crop to unknown entity risking our payments. We sell only at Hapa market yard in our district,” Patel said.

Arrivals of groundnut at Gondal APMC yard, the largest market in Saurashtra, during September 15-October 15 period last year was recorded at 31,900 tonnes, whereas in the current year arrivals for the same period stood at 23,165 tonnes. The close to 30 per cent drop in volumes, however, is because of delay in arrivals due to late withdrawal of monsoon and not because of trade moving outside APMC, say sources in the market.

Groundnut prices at Gondal market yard in Rajkot district were at Rs 4,430/quintal on October 15 as against Rs 4,750 recorded on the same day last year.

APMC revenues to drop

Even as farmers continue to prefer trade at APMCs, the trade bodies have a reason to worry.

An office bearer at Amreli APMC says there is going to be a drop in revenues for the APMC. “About 40 per cent of our market’s cess revenues have always been coming from the trade taking place outside the APMC premises. At taluka level, ginning units directly purchase cotton from farmers and we used to get a cess from them. Now, without this cess income, we are worried how would we manage our financial obligations,” the official stated.

Amreli APMC’s new market yard was expanded and modernised with a loan from Nabard. The yard was inaugurated by the Prime Minister Narendra Modi in 2017.

Source: https://www.thehindubusinessline.com/markets/commodities/in-gujarat-no-proof-of-higher-price-for-farmers-in-trade-outside-apmcs/article32903178.ece


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