Commodity Tips, Bumper groundnut crop triggers price crash; farmers hold on to stock
The Bharatiya Janata Party-led state government is acquiring groundnut at Rs 4,500 per quintal; the market price is Rs 3,500 per quintal
A bumper groundnut crop in Gujarat has led to a steep fall in prices. Consequently, farmers are holding on to stock, hoping that the government will acquire it at the minimum support price (MSP), which is higher than the market price. This, in turn, has led to a shortfall of raw material for oil mills.
The Bharatiya Janata Party-led state government is acquiring groundnut at Rs 4,500 per quintal; the market price is Rs 3,500 per quintal.
Till now, the government has acquired nearly 68,000 tonnes of groundnut, with Deputy Chief Minister Nitin Patel reiterating its decision to continue with the procurement.
Announced by the government in October last year, the procurement will be done in a staggered manner. “Hence, farmers are reluctant to sell at market prices lower than the MSP to oil mills," said B V Mehta, executive director, The Solvent Extractors’ Association of India (SEA).
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