On a vast farmland in Kalajhar mandi of Sangrur district, Punjab, farmers are waiting to negotiate with traders who have rejected their paddy crop infected due to humidity.

Chand Singh, 70, a farmer who owns 4 hectares of farmland in Kalajhar village, says traders rejected 20 tonnes of paddy that he cultivated as it was affected due to humidity. “If traders don’t accept it, I will have to sell it to a private agent at a much lower price than the Minimum Support Price (MSP).”

In July 2018, the MSP of paddy was Rs 1,750 per quintal but agents are paying only Rs 1,300-1,400 per quintal. The MSP is set by the Commission for Agricultural Costs & Prices (CACP) to incentivise the cultivators to adopt modern technology and raise productivity while being assured of a particular income.

Due to a longer spell of monsoon at September-end, humidity has affected paddy crops. This may mean that many farmers like Chand Singh may not be able to sell their crop. In the past three weeks, the price of paddy has reportedly dipped below MSP in more than 300 designated markets in India. In more than 60 per cent of designated markets in the country, the prices of cereals, oilseeds and pulses are much lower than MSP.

The market price of major agricultural produce has crashed below MSP, according to Agmarknet, a government agriculture market portal, that records data of more than 2,700 markets. Out of these 2,700 markets, the price has crashed in more than 1,700 major markets for commodities like cereals, pulses, oilseeds and cotton between October 1 and October 21.

The arrival of kharif crops like paddy, maize, pulses, cotton, groundnut, soybean starts in October. Even after three weeks of arrival, the market price is still quite low. (See table)

In Chhattisgarh, the ‘Rice bowl of India’, the price of paddy is lower than MSP in 112 markets. Also, many markets in Gujarat, Karnataka, Tamil Nadu, Uttar Pradesh, Telangana and West Bengal are selling the agricultural produce for prices much less than MSP.

Maize producers’ states like Karnataka, Maharashtra, Madhya Pradesh and Telangana have the largest share of maize market, but here too the selling price is lower than MSP. The MSP of maize is Rs 1,700 but the market rate is around Rs 1,200-1,400

“Market prices of most kharif crops like paddy, pulses, coarse cereals continue to be below the federally fixed MSP from the last one year,” says Ramandeep Singh Mann, a Delhi-based agricultural activist. “The price has been quite low from July 2017 through September 2018. Once again, Prime Minister Narendra Modi’s tall promises to farmers fizzle out,” he complains.

The Modi government has promised to double farmers’ income by 2022. In its 2017-18 budget, the government announced to fulfill the electoral promise to assure a MSP 1.5 times the cost of production. However, doubling the income of farmers still remains a distant dream.