Amid Covid gloom, farm sector blooms for the most part

Source: The Hindu Business Line, Jun 17, 2020

The Covid-19 lockdown and supply chain disruptions over the past few months have hit many industries. But the farm sector appears to have escaped these with the minimum impact.

While horticulture and dairy farmers did face the brunt of the lockdown, for the farm sector as a whole, it has not been bad at all. Sample these numbers:

Procurement under the minimum support price (MSP) programme in wheat during the rabi marketing season (2020-21) was about 11.7 tonnes by end-April versus 19.6 million tonnes (mt) in the same time last year. However, in the subsequent two months, procurement increased significantly: by June 12, total procurement by FCI and State agencies in wheat touched 37.7 mt (up 11 per cent YoY from 33.9 mt). And, given the MSP was at ₹1,925/quintal this year versus ₹1,840/quintal last year, it was a big relief for farmers.

In pulses too, procurement has been higher than last year benefitting over 8.7 lakh farmers. Since March NAFED has procured about 17 lakh tonnes of gram through 2,395 centres (at MSP of ₹4,875/quintal vs. market price of about₹4,200/quintal). Give that there is one more month left for rabi arrivals to end, total procurement in gram may be significantly higher; in rabi last year, total procurement in gram was 7.71 lakh tonnes.

Similarly, procurement in mustard seed has also been higher. So far, NAFED has procured about 7.53 lakh tonnes of mustard seed from about 2.96 lakh farmers.

Higher MSP procurement and PM-KISAN disbursements that have reached to over 9.5 crore farmers have actually boosted farm sentiment.

Greater liquidity

Farmers are spending more on agri inputs. Fertiliser sales in April and May were up almost 75 per cent over last year. Sales of major fertilisers including urea, DAP (diammonium phosphate), MOP (muriate of potash), NPK and others in the two months were at 60.3 lakh tonne, up from 34.6 lakh recorded last year. Sales of DAP and NP/NPK fertilisers more than doubled YoY. While this may be because of timely onset of monsoon and farmers increasing the area under cultivation, it also indicates liquidity in their hands.

The trend of higher fertiliser consumption has been observed since November — so, one can’t dismiss it off as a consequence of an increase in stocking by fertiliser dealers in anticipation of closure of production units due to the lockdown.

Over the past two months, the demand for seeds and pesticides has also been strong. Ram Kaundinya, Director General, Federation of Seed Industry of India, said: “Seed offtake since April has been pretty strong. Cotton, rice and millets have been picked up by farmers more than last year, showing around 10 per cent growth. In rice, too, we have seen a good uptake of direct sown rice, which needs less labour since there is no transplantation.

Farmers have been a bit reluctant to plant perishable crops like vegetables for fear of not being able to transport and sell them due to lockdowns and also because of lack of availability of labour.”

Tractor sales also were also good in May, recovering from April’s lows.

Tractor manufacturers are pointing to an increasing preference among farmers towards mechanisation. Mahindra & Mahindra, which holds an about 40 per cent share of the domestic tractors market, sold about 24,017 units last month, against 23,539 units in May 2019. Escorts (12 per cent share in tractor market) sold 6,454 units in May while Sonalika Group sold 9,177 units (up 18.6 per cent YoY).

Kharif sowing progressing well

The current kharif season, too, is expected to be strong, with a bumper output. As on June 12, the area under all kharif crops was up 13 per cent YoY at 92.56 lakh hectare (81.74 lakh hectare), per official data. Area covered under cotton was 18.9 lakh hectare (15.32 lakh hectare).

The monsoon so far has been surplus, reports the India Meteorological Department.

Reservoirs also have sufficient quantities of water. Per data, as on June 11, the storage available in 123 reservoirs in the country that are tracked by the Central Water Commission was 54.636 BCM, against 31.372 BCM last year. It is expected that the current season, too, will be good for agri input companies. Farmers may also see an income increase if procurement is high in cereals and cotton like last year.

Cabinet nod to two ordinances on agri trade, modern tech

Source: The Economic Times, Jun 04, 2020

NEW DELHI: The Union Cabinet on Wednesday approved two ordinances on farmers’ engagement with large processors and barrier-free agriculture trade, seeking to help them get remunerative price and attract private investment and modern technologies in the farming sector. It also cleared an amendment to the Essential Commodities Act, to remove commodities such as cereals, pulses, oilseeds, edible oil, onion and potatoes from the list of essential commodities. This will lift any restrictions on stocking these commodities by processors, millers, importers, exporters and traders.

Agriculture minister Narendra Singh Tomar said the decisions would help transform the agriculture sector in the country.

The Cabinet approved The Farmers (Empowerment and Protection) Agreement on Price Assurance and Farm Services Ordinance, 2020.

Fruit and vegetable output set to cross record 320 mt

Source: The Hindu Business Line, Jun 02, 2020

New Delhi: Spectacular increase in the production of onions after the severe crop loss during the last monsoon season, together with relatively better yield in potato and banana ,has helped the country to have a record horticulture harvest of 320.48 million tonnes (mt) in the current crop year, according to the second advance estimates of horticulture crops released by the Agriculcture Ministry on Tuesday.

However, there hasn’t been much increase in area under horticulture crops over 2018-19. The total area under these crops this year was 25.66 million hectares as against 25.43 million hecatres in the previous year.

While the production of vegetable is projected to go up to 191.77 mt from 183.17 mt in 2018-19, total fruits output may cross 99 mt MT as against close to 98 mt last year.

Onion production is estimated to 26.74 mt as against 22.82 mt in 2018-19 whereas potato output would be 51.3 mt as against 50.2 mt last year. Tomato output is expected to cross 20 mt from 19 mt in the previous year.

The onion production is significantly high in the later parts of the year considering that many onion-growing areas in the country, particularly in Maharashtra and Karnataka witnessed severe floods leading huge crop loss in the prevous kharif season.

Among fruits, banana, citrus and apple performed bettered their output last year. The output of plantation crops and spices more or less remained at last year’s levels at 16.24 mt and 9.42 mt respectively.

Farm sector may be sole bright spot this year, says govt

Source: Business Standard, Apr 29, 2020

New Delhi: Agriculture may be the sole bright spot in the overall gloomy economic outlook for the country due to the Covid-19 lockdown. The sector may push up the country’s gross domestic product (GDP) for 2020-21 by 0.5 to 1 percentage points, the Centre said on Wednesday.

The government is placing its optimism on projections of a ‘normal’ monsoon for 2020 that addresses 60-70 per cent of the sector’s worries.

It said growth in agriculture and allied activities will not be much lower than the 3.7 per cent expected in real terms for 2019-20.

“We are hopeful that agriculture growth won’t get impacted by the Covid-19 lockdown in 2020-21 and won’t be much below 3.7 per cent expected in 2019-20,” agriculture and rural development minister Narendra Singh Tomar told reporters during a briefing on farm sector and Covid-19.

NITI Aayog member and agriculture economist Ramesh Chand, who was also present at the briefing, said that farm sector may record a growth of 3 per cent which is on par with long-term average for the sector.

Most global and Indian rating agencies and even multilateral funding agencies such as World Bank and IMF have projected the Indian economy to grow by less than 2.8 per cent in 2020-21, Chand said that if agriculture performs well, it is poised to give a 0.5-1.0 percentage point push to the country’s overall GDP.

Tomar said the first economic activity that was allowed by the government after the lockdown was imposed was agriculture and related sectors and the farmers have also responded favourably. This is why despite all difficulties, almost 90 per cent of the rabi crop has been harvested and a significant quantity has also been procured.

He said the forecast of ‘normal’ monsoon has also given hope that sowing for kharif crops, which is due in the next few weeks, will be good and the country will be on track to achieve the targeted 298.3 million tonnes of foodgrains production in 2020-21.

“We have taken all possible measures to ensure that maximum crops produced by farmers are procured so that their income doesn’t come down. We plan to purchase 5.44 million tonnes of rabi oilseeds and pulses from the growers this year for which a sum of Rs 25,637 crore has already been allocated,” Tomar added.

Of this, around 0.5 million tonnes of pulses and oilseeds have already been procured. This is in addition to 11.7 million tonnes of wheat and 1.8 million tonnes of rice, purchased so far.

Tomar said against 1,485 oilseeds and pulses procurement Centres in 2019, this year, their number has been raised by almost 88 per cent to 2,790. More centres will be added as the procurement processes gets underway.

He said to enable farmers get higher price for their produce, 100 new mandis will be added to the electronic-national agricultural market (e-NaM) platform by May first week, taking their total to 685.

The number will be increased to 1,000 by the end of the month.

On MGNREGA, Tomar said an advance allocation of Rs 33,000 crore has been made while all states and district officials have been instructed to provide as much work as required under the scheme to support the rural sector.

“In April 14, when work under MGNREGA was exempted from the lockdown, around 1.7 million persondays of work was provided, which today (April 29, 2020) has risen to almost 17 million persondays,” Tomar said.

He said in 2019-20, around 66 per cent of the work undertaken under the scheme was related to agriculture, while in 2020-21, the target is to undertake around 77 per cent of agriculture-related works.

On the Centre’s ambitious target of Doubling Farmers Income by 2022, the agriculture and rural development minister said that though the Covid-19 crisis has put some hurdles, the government is confident of achieving the same within the targeted time frame.

Meanwhile, Chand said that their assessment shows that mandi prices of wheat, gram, rapeseed, potato and onion is more than last year which means farmers’ realisation is better. “In April 2020 alone, the offtake of fertilisers has grown by 5 per cent as compared to same period last year, while distribution of seeds through the Krishi Vigyan Kendras (KVKs) has risen by 20 per cent,” Chand added.

Record fertiliser sales witnessed during lockdown

Source: The Economic Times, Apr 28, 2020

The exemption in agricultural activities during the lockdown has resulted into a record sales of fertilizer during this month.

According to data from fertiliser ministry, fertiliser dealers across the country purchased 15.77 lakh tonnes which is 46% higher that last year’s sales of 10.79 lakh tonnes during first 22 days of April.

The forecast of a normal monsoon this year is likely to increase the crop area and thus the consumption of fertiliser.

“During the first 22 days of April, the sales of fertiliser was 10.63 lakh MT which is 32 percent higher than the last year sale of 8.02 lakh MT during the same period,” said a fertiliser ministry official.

Union Minister of Chemicals and Fertilisers D V Sadananda Gowda has assured availability of fertiliser through out the crop season.

“There is no problem of fertiliser. State governments have sufficient stock of the fertiliser. We are in touch with state agriculture ministers,” he said.
The ministry has been transporting fertilisers through special trains across the country.

“On 17th April, 41 Fertilizer Rakes moved from plants and ports. This is the highest movement of fertilizers during lockdown period in a day. One Rake carries 3000 MT of load at a time. production in fertilizer companies is going on in full capacity,” the official said.

The government, Under Essential Commodities Act, has allowed operation of fertiliser plants in the country so that agriculture sector may not feel the heat of lockdown.

Govt sets record foodgrains production target

Source: The Economic Times, Apr 16, 2020

New Delhi: Amid forecast of a normal monsoon this year, the government has set the production target for foodgrains at a record 298.3 million tonnes for 2020-21 crop year (July-June), comprising 149.92 million tonnes in kharif (summer) season and 148.4 million tonnes during rabi (winter) season.

The targeted production is over 2% more than the last year’s estimated food grains production of 291.95 million tonnes.

“We have targeted the rice production at 117.5 million tonnes and wheat production at 106.5 million tonnes – almost equal to last year’s estimated output. We are focusing on increasing the output of pulses and oilseeds as import bill of edible oil is rising every year,” said agriculture commissioner S K Malhotra during the national Kharif conference on Thursday.

The government aims to produce 25.6 million tonnes of pulses and 36.64 million tonnes of oilseeds in this crop year.

The government has also forecast a pick up in demand of cotton.

“There will be increasing demand of cotton this year. We have targeted to produce million bales – up from last year’s estimated production of 34.89 million bales,” Malhotra said.

He advised cotton farmers to complete sowing operation by May 15 and recommended use of tolerant varieties with proper dose of fertilser and urea.

Modi unveils 10,000 Farmers Producer Organisations to boost farm income

Source: Business Standard, Feb 29, 2020

Lucknow: Aiming to augment agricultural income by helping farmers trade in their produce, Prime Minister Narendra Modi today launched 10,000 Farmers Producer Organisations (FPO) all over the country.

Addressing the launch ceremony at Chitrakoot district in Uttar Pradesh, Modi said the government would spend Rs 5,000 crore in the next five years to strengthen FPOs for the benefit of farmers.

“The farmers have always been producers, but with the help of FPOs, they can now trade in farm produce. They will sow crop and also act as skillful traders to get the right prices,” he observed.

On the occasion, he also laid the foundation of UP’s mega infrastructure project, the 296-km Bundelkhand Expressway, which is estimated to cost Rs 15,000 crore.

The PM said the Central Government had integrated farm policies with the farmers’ income to maximise the benefits even as he referred to the increase in the minimum support price (MSP), soil health card, neem coated urea and reenergising irrigation schemes to buttress his point.

“More than 85 million farmers’ families have been provided with over Rs 50,000 crore under PM Kisan, of which more than 20 million farmers belong to UP, who have been paid Rs 12,000 crore,’ he said adding payments were being made directly into their bank accounts.

Modi said the PM Kisan and other farmers’ schemes were targetted to save farmers from the clutches of the money lenders and to provide them each penny intended for them.

Meanwhile, he announced plans were also afoot to integrate all PM Kisan beneficiaries with the flagship Kisan Credit Card (KCC), so that such farmers could borrow loans from banks.

Under the Fasal Bima Yojana, the Indian farmers had been paid total claims worth Rs 56,000 crore against the total premium collection of Rs 13,000 crore, he informed.

The PM said the Centre was working on a mega plan to upgrade the rural mandis into modern agri retail markets and to further integrate them with the state agro marketing boards and the government e-marketplace e-NAM.

“We are working on a plan so that the farmers need not travel long distances to sell their produce,” he said adding transactions worth Rs one trillion had been done on mandis integrated with e-NAM so far.

He said at least one FPO should be formed at each block level for deeper percolation of the scheme. Nearly 86 per cent of Indian farmers are small and marginal with average land holdings being less than 1.1 hectares. These together with the landless farmers face challenges in accessing technology, quality seeds, fertilisers and pesticides apart from finance, in addition to marketing their produce. The FPOs would provide a platform for ‘collectivisation’ of small, marginal and landless farmers and give them collective strength to deal with such issues.

Centre pays Rs 50,850 crore to farmers under PM-KISAN scheme

Source: The Economic Times, Feb 22, 2020

The Centre on Saturday said it has disbursed Rs 50,850 crore to farmers so far under its landmark scheme PM-KISAN, enabling them to meet farm input cost and household expenses.

The agriculture ministry shared the progress made under the scheme, ahead of its first anniversary on February 24.

The PM-KISAN was formally launched on February 24 last year by Prime Minister Narendra Modi at Gorakhpur, Uttar Pradesh.

Under the scheme, the Centre transfers an amount of Rs 6,000 per year, in three equal instalments, directly into the bank accounts of the farmers, subject to certain exclusion criteria relating to higher income status. Read the rest of this entry »

Cabinet approves crop cover rejig, dairy sop schemes

Source: The Economic Times, Feb 20, 2020

New Delhi: The Cabinet has approved revamping of the crop insurance scheme to help farmers manage risks better and cleared a proposal to create 10,000 farmer producer organisations (FPOs) to give cultivators economies of scale and better bargaining power in the market.

It also raised interest subvention under the Dairy Processing and Infrastructure Development Fund to 2.5% from 2%, aiming to help 9.5 million milk producers in 50,000 villages with higher cooling, drying and processing capacity as well as infrastructure for value-added products to enhance incomes. Read the rest of this entry »

Govt agencies partner with transportation players to increase agri exports

Source: Business Standard, Feb 17, 2019

Mumbai: Last month when Maersk, the global integrated logistics company, delivered its first end-to-end shipment of freshly produced green chillies from Varanasi to Jebel Ali, United Arab Emirates (UAE) within nine days, it was among the initial efforts by the company to get agriculture exporters to use its services.

Maersk, in fact, is working closely with Agricultural and Processed Food Exports Development Authority (APEDA) to enable trade opportunities through land and sea routes. This is a part of government efforts to work with transportation players in order to meet the target of $60 billion in agriculture exports by 2024.

“We are preparing a scheme where agri product exports even via airways are being looked into apart from ocean transportation for faster movement of agri cargo overseas,” an official at APEDA told Business Standard on condition of anonymity.

APEDA is an organization under the Ministry of Commerce & Industry and the firm is exporting agri products worth $38 billion, at the present. “We have partnered with Maersk alone and are awaiting the report on the shipment,” an APEDA official said.

Maersk with 5 per cent of its total India volumes in agri-segment is looking to explore opportunities of growth in this area by maintaining consistency in its shipments.

“There is a lot of untapped potential in fresh produce exports out of India and our market share is one-third of total. Our plan is to have consistent exports of certain products to improve overall market share as well as the volumes,” said Steve Felder, managing director, Maersk South Asia.

Noting the lack of temperature controlled infrastructure, Maersk has also started renting out its containers. The firm also provides end-to-end services for agri product exports, .

“Customers are paying a monthly fee and we maintain the containers. It is an area where customers have responded very well. So we will continue to focus on this segment as well apart from shipment via temperature controlled containers,” said Felder.

While the investment figures were not revealed the company said it has invested not just in improving the container technology but also on research and development. “Other government agencies such as the Spice Board are also taking similar steps to up exports of its products,” said APEDA official. APEDA has already sounded off all the 29 states regarding the agri export plan to which 22 states have responded.