Centre urges 5 States to engage NCCF in paddy procurement

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The Centre has asked Andhra Pradesh, Chhattisgarh, Madhya Pradesh, Uttar Pradesh and Odisha to engage the National Cooperative Consumers’ Federation of India (NCCF) to procure paddy from farmers at the minimum support price (MSP) during the next marketing season starting October 1. The Government purchased 20.12 million tonnes (mt) of rice under MSP operation in the 2023-24 kharif season from these five States.

In a letter earlier this week, the Food Ministry informed the Food Corporation of India (FCI) and the concerned States about the interest shown by the NCCF to work as an additional procurement agency for paddy.

The Ministry wrote that since NCCF has indicated its willingness to work as a procurement agency for paddy at MSP for the Central Pool during the 2024-25 kharif marketing season (KMS), “it is, therefore, requested to consider engaging NCCF as one of the procurement agencies for paddy procurement during KMS 2024-25.”

The rice procurement was 1.44 mt in Andhra Pradesh, 8.3 mt in Chhattisgarh, 2.83 mt in Madhya Pradesh, 3.6 mt in Uttar Pradesh and 3.95 mt in Odisha in Kharif season 2023-24.

Maize buy failure

Traders and rice milling industry experts said NCCF does not have any infrastructure of its own to undertake this kind of a large scale operation and it will add to the acquisition costs. “The primary agriculture credit cooperative societies (PACS) and self help groups (SHGs) are doing good and those should be strengthened leveraging technology so that role of middlemen is curtailed,” an expert said.

“Looks it could be difficult for it to function as a central agency to procure paddy. In maize procurement, we have seen that NCCF could not do much. Secondly, since the agency is also involved with NCEL as a supportive arm in rice export, the government should have avoided it,” said a trade expert.

The Centre has fixed kharif-grown rice (paddy converted in terms of rice) procurement target at 48.5 mt for the 2024-25 marketing year (October-September).

The procurement period of kharif-grown rice in the 2023-24 season (October-September) ended on June 30 as different states follow different period depending on the rice growing season. The procurement in 2023-24 was 46.3 mt, which was 6.5 per cent lower than 49.53 mt procured in 2022-23, due to a drop in most of the states.

The government needs about 40 mt of rice annually to run all the welfare programmes including the obligation under the National Food Security Act (NFSA).