Centre mulls over raising cotton MSP


Takes farmers’ demand to the discussion table

Hyderabad: In a proactive action, the Union government on Monday initiated a discussion on the issue of declining cotton prices below the minimum support price (MSP) levels in some states, besides reviewing farmers’ demand to raise the support price for the current year in order to protect the growers’ interest.

“We called a meeting to discuss the cotton issue. Cotton prices have fallen in the country and there is a demand from farmers that MSP should be increased further or bonus should be given,” Minister of State for Agriculture Mohanbhai Kalyanjibhai Kundariya said after the meeting.

Earlier, the government had fixed the minimum support price (MSP) at Rs 4,100 per quintal for long staple cotton and Rs 3,800 per quintal for medium staple cotton for the 2015 -16 marketing year.

Senior officials from agriculture and textile ministries as well as the chairman of the Commission for Agricultural Costs and Prices (CACP) were present at the meeting.

Kundariya said, “All cotton-growing states are demanding increase in MSP. We will take up the issue at a higher level. With regard to bonus, the state governments are free to announce it to protect the interest of 

farmers.” The meeting directed the state-owned Cotton Corporation of India (CCI) to open procurement centres at the earliest at places where prices have fallen below the MSP.

Interestingly, the CCI, which has claimed to have started cotton procurement centres in Andhra Pradesh and Telangana, plans to procure just about 20 to 25 lakh bales (of 170 kg each) in the current marketing year.   

However, the farmers association in Telangana says that CCI is yet to start procurement in full scale. 

On the other hand, the farmers are seen selling the stock to middlemen and not bringing the cotton bales fearing delay in procurement at MSP. 

They point out that the latest government move to up the MSP would benefit only the traders who have already bought the cotton at below Rs 3,600 per quintal.  

Last week, CCI CMD B K Mishra had said: “Cotton rates have not fallen below the MSP in all states. It would definitely procure cotton from those places where prices are ruling below the support price.” On the other hand the traders here say that the cotton prices are ruling lower in the wake of poor export demand.