In an earlier story, we looked at MSP procurement numbers across different states and the related trends. Data further indicates that the average market prices for rice & wheat have fluctuated during the procurement season and are not necessarily more than MSP. But is increased MSP procurement a solution? In the earlier story, we explored the numbers relating to MSP (Minimum Support Price) for various food grains over the years, the procurement of these food grains and the trends across states. From the data, it is evident that, the procurement of food grains at MSP, especially of Rice and Wheat is highly skewed and most of the procurement by the government is done in only a few states. In this story, we further explore the uneven procurement of the food grains in the country, the sale of farm produce by the farmers beyond the markets set up by AMPCs (Agricultural Produce Market Committee) and FCI’s sale of food grains etc. Punjab & Haryana have the highest targets & achievement for Wheat procurement The individual data of the states indicates that the procurement targets set for each of the states vary widely ultimately resulting in the varying amounts of government procurement. We spoke an official from the FCI regarding the rationale of such widely varying targets among the states and were given to understand that, prior to every marketing season (i.e. Kharif & Rabi), respective states send their proposals to the centre, with information on expected production for the year and the procurement of food grains that they can manage for the central pool. Based on these proposals, the central government announces the procurement target for the upcoming marketing season along with the procurement targets for each of the states. This is the case for the procurement of both Rice as well as Wheat. The data of the last three years indicates the trends to be uneven in the case of Uttar Pradesh and Madhya Pradesh. After a shortfall compared to the expected target in 2017-18, Madhya Pradesh has exceeded the target of 67 lakh tones for 2018-19 by procuring 73.13 lakh tons. However, after the target was increased to 75 lakh tons in 2019-20, the procurement is only 67.25 tons as on date. Similarly, the targets for Uttar Pradesh was set higher at 50 Lakh tons for 2019-20 based on the earlier procurement performance but fell short of the target. Rajasthan not only has lower procurement targets but also these targets are not often met. The shortfall in targeted procurement of these states is compensated with additional procurement from Punjab and Haryana. As per the available data, Punjab and Haryana tend to have the highest procurement targets for Wheat, and in each of the last three years, the actual procurement has exceeded these targets. Procurement target for rice is met over Kharif & Rabi Seasons for a few states Analysis of the data for procurement of Rice from various states indicates that the each of the states have managed to procure the amounts set as targets for 2019-20. However, there are differences in the targets itself in terms of procurement quantity, with Andhra Pradesh, Telangana and Punjab accounting a large share of the procurement targets. Unlike in the case of Wheat, the procurement of Rice happens over Rabi and Kharif seasons. In a few of the states, the procurement targets are met over both the Kharif & Rabi seasons. As is the case highlighted earlier, the target for procurement is based on the proposals sent by the respective states prior to the beginning of the marketing season. As highlighted in the earlier story, the procurement in different states is not in proportion to the production in those states. The process and the data indicate that few states have opted to set a higher target of procurement, while few others have set a lower target. This could either be due to the inability of the states to mobilize resources for procurement, or the presence of better sales alternatives for the farmers, then the MSP procurement by the government. Market Prices of Paddy & Wheat are fluctuating and lower than MSP at different times in different states The MSP for Paddy was set at Rs.1815 per quintal for 2019-20 and Rs.1868 for 2020-21. As per the data available from the different markets across the country, the price for Paddy varies across the states and fluctuated at different points of time. Andhra Pradesh, Telangana and Punjab which are among the states with highest MSP procurement by the government, also have market prices near about the declared MSP during different times in the period between October’19 and August’20.