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Pulses imports: Data anomalies, restrictions put trade in a fix

Pulses imports: Data anomalies, restrictions put trade in a fix

May 17, 2018

 

Suddenly, there is a lot of action on the pulses trade front. The market is witnessing a spate of trade notices from the Commerce Ministry including procedure for importing 150,000 tonnes from Mozambique in terms of the MoU signed by India and clarification that the expression ‘peas’ would include yellow, green and dun peas.

 

Another important trade notice (May 11, 2018) is the announcement of procedure for import of pulses under restricted category — tur/arhar or pigeon pea, black matpe and moong — after a commentary in this newspaper (April 26, 2018) highlighted the avoidable delay in announcing new quotas for the fiscal 2018-19.

 

The salient feature of the notification is that actual users, i.e., dal mills (and not traders), will be allowed to import of two lakh tonnes of tur/arhar as also 1.5 lakh tonnes each of urad and moong. This, too, is in terms of a recommendation made in these columns (January 4, 2018).

 

Discrepancies

Yet, there are glaring anomalies in the trade notice. Dal mills have been asked to apply for quota indicating their monthly/annual processing capacity. There are several thousand dal mills with wide variation in milling capacity — many as low as 20-50 tonnes a day and a few as large as 300 tonnes a day. However, the notification says: “Total available quota for each category will be distributed equally or the applied quantity, whichever is lower, amongst eligible millers”.

 

If the quota is going to be distributed ‘equally’ among millers, it makes no sense asking the applicants to specify their milling capacity. There appears to be a blunder. It is highly likely that the intention is to allot quotas ‘proportionately’ or ‘equitably’ based on the milling capacity of each applicant. This aspect needs clarification.

 

Harvest time

Another condition states that the importers will complete their imports by August 31, 2018. This is a wholly unnecessary restriction that will lead to a scramble in the trade. The condition ignores the cropping season in different origins. Myanmar harvested its crop in February/March, while East Africa will harvest in August.

 

It is a moot point that India’s own kharif harvest of pulses will take place in September/October. Yet, as the quota is for the whole year 2018-19, importers may be allowed more flexibility.

 

The government is holding over 11 lakh tonnes of pulses (mainly pigeon pea) which needs to be liquidated without delay. It is unfortunate that the Centre has been focusing more on restricting the supplies rather than work on demand expansion. Given the low per capita availability and enormous nutrition challenge, it is time to seriously consider inclusion of pulses under the public distribution system. That will improve the marketability of pulse crops and support prices.

 

Acreage may shrink

Meanwhile, risks of a decline in acreage under pulses in the upcoming kharif planting season are rising. Market rates have continued to stay well below the specified minimum support price for most pulses. Growers are disillusioned because of ineffective procurement by State agencies. There is the strong possibility that up to 20 lakh hectares may move away from pulses to other more remunerative crops such as soyabean.

 

Source:https://www.thehindubusinessline.com

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