iGrain India - New Delhi. The Union Agriculture Ministry has estimated the domestic production of gram to decrease by about one lakh tonne in comparison to 2022-23 to 121.60 lakh tonnes in the current season of 2023-24, but the industry-trade sector believes that the actual production has been less than 100 lakh tonnes.
The harvesting and preparation of the crop has been completed but till now there is no pressure of its supply in the markets.
Due to the huge difference between demand and supply, the open market price of gram has crossed the psychological limit of Rs 7000 per quintal for the first time.
As a result, government agencies are facing great difficulty in purchasing gram for buffer stock.
To increase the supply and availability of Desi gram, the government has made its import duty free till October 2024, but in view of the limited stock in exporting countries and especially Australia and Tanzania, this decision of the government is unlikely to have much positive impact.
The import of gram may be slow and in less quantity. The minimum support price of gram has been fixed at Rs 5440 per quintal this time, which is Rs 105 more than last year's support price of Rs 5335 per quintal.
In comparison, the wholesale market price of gram is running at Rs 7200-7300 per quintal i.e. about 35 percent higher, which is surprising.
March to May is considered to be the peak season for the supply of gram and the price is expected to remain low during this period.
But this time the situation is completely opposite. Neither the supply and availability of gram is increasing in the markets nor is there any sign of softening in prices.
It is worth noting that to reduce the price of gram, the government has also made the import of yellow peas duty free till October and it has also been imported in huge quantities from abroad, but the price of gram has not been affected by this at all.
Government officials have indicated that in case the prices do not soften, it can be considered to impose storage limits on gram.
But critics believe that storage limits will not prove to be very beneficial or effective as the stock of gram is not with the millers and traders but with the producers.