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Maharashtra government may suffer Rs 300cr hit as tur rates drop

Maharashtra government may suffer Rs 300cr hit as tur rates drop

Nov 8, 2017

 

Maharashtra government may suffer Rs 300cr hit as tur rates drop

 

The state government is staring at the prospect of non-recovery of Rs 300 crore as it struggles to find buyers who will offer a good price for the large amount of tur it purchased from farmers early this year.

 

In the 2016-17 season, Maharashtra had a record production of tur, nearly five times that in the previous year, and as part of the government's intervention to curb falling prices, a state agency , the Maharashtra State CooperativeMarketingFederation, started purchasing tur from farmers at a minimum support price (MSP) of Rs 5,050 per quintal.The over-production was attributed to the good rates tur fetched in 2015-16, which led to retail prices being as high as Rs200 per kg, and the state's decision to promote tur among farmers that year.

 

Due to the massive response to the scheme and political pressure to continue purchases, the state bought 25 lakh quintals of tur worth Rs 1,262.5 crore, which also led to all its godowns being full. Now, the government is looking for buyers for the tur to recover money , and the wholesale rate in the open market is between Rs3,800-4,000 per quintal. The rent of godowns and the cost of fumigation and maintenance of the tur has also to be factored in, officials said. "Per kg, the cost of tur for us comes to Rs 56-58, and the rate traders are quoting us is Rs38-40 per kg," said an official. Officials said the losses for the government could run up to Rs300 crore as the price in the open market continuous to fall. An official said the government cannot hold on to the tur any longer as it needs to vacate its stores for purchases to be made in the upcoming season, which starts at the end of this month. The government needs space to store crops like cotton, moong and udad, which it has started procuring, and also for fresh tur which will be introduced in the market. Once the fresh stock of tur is in, the rate the government is getting now will further reduce, he said.

 

"We are not thinking of the total amount of money that may never be recovered now, but just of how to sell the tur with minimal loss," said a senior government official. Meanwhile, the state has given orders to mill 3,960 quintals of tur into tur dal and will be selling it to government departments like education and women and child welfare for supplying to their canteens and anganwadis. "We are hoping that at least 6 lakh quintals, their overall demand, they will take from us at no-loss, no-profit rates," said the official.Officials said the loss that the state suffers could have an impact on purchases that the government will make in the coming season, leaving the farmers at the mercy of traders.

 

Source: https://timesofindia.indiatimes.com/city/mumbai/maharashtra-government-may-suffer-rs-300cr-hit-as-tur-rates-drop/articleshow/61557517.cms

 

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