Consumer Affairs, Food and Public Distribution Minister Piyush Goyal today stated that the agriculture sector will be the foundational pillar spearheading the nation towards becoming ‘Viksit Bharat’ by 2047. He was addressing the gathering at the launch ceremony of ‘e-Kisan Upaj Nidhi’ (Digital Gateway) of the Warehousing Development and Regulatory Authority (WDRA) in New Delhi. The Minister said that the ‘e-Kisan Upaj Nidhi’ initiative will ease the farmers’ warehousing logistics with the help of technology and aid the farmers in receiving fair prices for their produce. He said that the initiative with its simplified digital process can ease the procedure of farmers' storage at any registered WDRA warehouse.

 

Mr. Goyal announced that the security deposit charges at WDRA registered warehouses will soon be reduced to encourage more farmers, especially small farmers, to utilise the warehouses and enhance their income. He said that the farmers stocking their produce at these warehouses would need to pay only one percent security deposit instead of the earlier three percent. 

With the negotiations for the proposed India-UK free trade agreement (FTA) reaching the last leg, a British delegation is here to iron out differences on remaining issues, sources said. The chief negotiators of both countries may hold negotiations on issues such as goods, and services.

 

Sources said that issues such as the British demand for a cut in customs duties on electric vehicles may come up for discussion.

 

So far 13 rounds of talks have been completed. The 14th round was started in January.

 

Talks are also progressing on the proposed bilateral investment treaty (BIT). India and the UK launched the talks for a free-trade agreement (FTA) in January 2022.

 

There are 26 chapters in the agreement, which include goods, services, investments and intellectual property rights.

 

The Indian industry is demanding greater access for its skilled professionals from sectors like IT and healthcare in the UK market, besides market access for several goods at nil customs duty.

 

On the other hand, the UK is seeking a significant cut in import duties on goods such as scotch whiskey, electric vehicles, lamb meat, chocolates and certain confectionary items.

 

Britain is also looking for more opportunities for UK services in Indian markets in segments like telecommunications, legal and financial services (banking and insurance).

The government has, as part of India's outreach to the Global South, allowed the exports of 1,10,000 tonnes of rice to three African countries to help them meet their food security needs.

 

According to a notification issued by the Directorate General of Foreign Trade (DGFT), the export of 30,000 tonnes of non-basmati white rice has been allowed to Tanzania while 30,000 tonnes of broken rice have been permitted for export to Djibouti and 50,000 tonne to Guinea Bissau.

 

Though exports of non-basmati white rice have been banned since July 20, 2023 in order to ensure adequate domestic supplies and control inflation.

 

However, some exports are being allowed to friendly countries to ensure their food security which has been adversely impacted as supplies have been disrupted due to the ongoing Russia-Ukraine war.

 

The African countries had sought support from India to meet their needs as they were facing problems due to shortage of food supplies and runaway inflation in its wake.

The government has permitted exports of 64,400 tonnes of onion to the UAE and Bangladesh through the National Cooperative Exports Ltd (NCEL), according to notifications of the commerce ministry. While export of 50,000 tonnes of onion is permitted to Bangladesh, shipments of 14,400 tonnes were allowed to the UAE.

 

'Export of 14,400 tonnes of onions, with a quantity ceiling of 3,600 MT (metric tonnes) quarterly, to UAE through NCEL is notified,' the directorate general of foreign trade (DGFT) said in a notification.

 

DGFT is an arm of the commerce ministry, which deals with norms related to imports and exports.

 

For exports to Bangladesh, it said that the modalities for the exports will be worked out by the NCEL in consultation with the department of consumer affairs.

 

Though onion exports are banned, the government allows specified quantities to friendly nations.

 

The exports are allowed on the basis of permission granted by the government to other countries based on their request.

 

On December 8 last year, the government banned exports of onion till March 31 this year with a view to increase domestic availability and to keep prices in check.

 

Earlier, the Centre in October 2023 had decided to step up the sale of buffer onion stock at a subsidised rate of Rs 25 per kg in retail markets in order to provide relief to consumers.

 

To control prices, the government has earlier taken several steps. It had imposed a minimum export price (MEP) of USD 800 per tonne on onion exports on October 28 till December 31, 2023.

 

In August, India had imposed a 40 per cent export duty on onions up to December 31, 2023.

 

Between April 1, 2023 and August 4, 2023 this fiscal, 9.75 lakh tonnes of onions have been exported from the country. The top three importing countries in value terms are Bangladesh, Malaysia and the UAE.

 

Onion is a politically-sensitive commodity.

 

NCEL is a multi-state cooperative society. It is jointly promoted by some of the leading cooperative societies in the country, namely, Gujarat Cooperative Milk Marketing Federation (GCMMF), popularly known as AMUL; Indian Farmers Fertilizer Cooperative Ltd (IFFCO); Krishak Bharati Cooperative Ltd (KRIBHCO); and National Agricultural Cooperative Marketing Federation of India Ltd (NAFED).

Union Agriculture Minister Arjun Munda on Monday said the government has launched a mission to boost production of oilseeds and reduce imports of cooking oils. The minister virtually inaugurated administrative-cum-academic building, Manas Guest House, Subansiri Girls Hostel and Brahmaputra Boys Hostel at IARI, Dirpai Chapori, Gogamukh, Assam.

 

Union Minister of State for Agriculture Kailash Choudhary was present at the inaugural event and visited an exhibition stall at the Indian Agricultural Research Institute (IARI), Assam.

 

According to an official statement, Munda said Prime Minister Narendra Modi has special emphasis on the development of the Northeastern region.

 

He said the central government has done the work of eliminating the gaps in the development of agriculture in the northeastern states and bringing them into the mainstream.

 

Munda said the government is working with the resolve to make the country a developed nation by 2047, in which the role of agriculture is very important.

 

He highlighted that a mission of Rs 11,000 crore is being run to reduce the burden of edible oil imports and become self-reliant in oilseeds.

 

'We have to work with the thought that in the coming days, we will not import but export,' Munda said.

 

India imports about 16 million tonnes of edible oils annually to meet domestic demand. In terms of value, India imported edible oils worth about Rs 1.38 lakh crore during 2022-23 (November-October).

 

The Union agriculture minister also stressed the development of climate-resilient crop varieties.

 

He emphasised linking agriculture education to livelihood and employment opportunities.

 

Munda said biodiversity studies also need special attention. He hoped that in a year, this institute would be the most preferred choice for research.

 

He emphasised that technologies have to be climate-neutral and gender-neutral.

 

Choudhary urged scientists to exploit the natural diversity that exists in the Northeast Region. He stressed focusing on research related to pulses and oilseeds so that the country does not have to spend too much money on the import of pulses.

 

Basmati export prices have dropped in the past couple of months to the level of minimum export price (MEP) of $950/tonne from over $1,050, which some exporters fear could be a loss-making proposition to ship out if the purchase price of Basmati paddy on October-November is taken into account. Some premium Basmati varieties’ prices too have dropped to about $1,200/tonne from $1,300, industry sources said.

 

However, many exporters said it is not a concern as most of the exports were contracted at higher rates when they were signed amid concerns over global supply disruption due to conflict between Israel and Palestine.

 

Basmati rice exports have increased by 12.3 per cent at 4.11 million tonnes (mt) during the January 2023-24 fiscal from 3.66 mt in the year-ago period, as per provisional data released by Agricultural and Processed Foods Exports Development Authority (APEDA). In value terms, the growth is an impressive 20.2 per cent at $4.59 billion against $3.82 billion year-ago. The higher growth has been attributed by industry experts on increased demand from countries such as Saudi Arabia and Iraq.

 

Striking bargains

The average realisation was about $ 1,120/tonne until January, whereas it was nearly $1,045 year-ago, said an exporter. However, the basmati paddy was considerably lower in harvesting period (October-December) of 2022 from the same period in 2023, the exporter said. He said while it is less than 10 per cent increase in the export realisation, paddy prices this year (2023-24) were 20-25 per cent higher.

 

In Punjab, Pusa Basmati 1509 (paddy) sold at Rs.3,200-3,600/quintal, depending on quality while Pusa Basmati 1718 at about Rs.3,800 in November 2023. On the other hand, traditional Basmati CSR 30 commanded between Rs.6,300 and Rs.6,600/quintal for the farmers. The key Pusa 1121 was sold at Rs.4,300-4,500 per quintal, whereas last year it was Rs.3,600-3,800.

 

'There is a slowdown in demand from overseas buyers after the Red Sea issue came up as freight cost increased. But, this type of event is normally temporary and hope we see things to normalise in the days ahead,' said Vijay Setia, a former president of All India Rice Exporters Association.

 

Response to global trade

According to foreign trade policy expert S Chandrasekaran, current basmati export price decline is a response of global trade demand sentiments and pressure from competitive supply. 'However, the export price will recover when domestic and export market finds equilibrium. This will reflect at the end of festival season in the West Asia,' he said.

 

Further, Chandrasekaran said the local demand and higher price realisation from domestic market brings new trend and trade stability for basmati rice.

 

Official sources in the Commerce Ministry do not see the fall as a concern and term it as normal market trend on demand-supply issue. The officials said that since more than 90 per cent of the shipments have already gone in the ten months of this fiscal as against 4.56 mt exported during the entire 2022-23, the exports in February and March may also follow the current trend of 10-12 per cent rise.

In a significant move to ensure food security during Ramadan, Bangladesh has imported 400 tonnes of chickpeas, marking the first batch of a 4,000-tonne import plan by the Trading Corporation of Bangladesh (TCB). The consignment, which arrived at Benapole Port, is part of a broader initiative to provide essential commodities at subsidized rates to ease the financial burden on citizens during the holy month.

 

Strategic Import for Ramadan

The arrival of chickpeas at Benapole Port on Sunday and their subsequent release after quality checks signify the government's commitment to stabilizing food prices ahead of Ramadan. Imported at Tk 85 per kilogramme, the TCB will offer these chickpeas at a subsidized rate of Tk 55 per kg. This initiative is part of the government's effort, led by Prime Minister Sheikh Hasina, to purchase essentials well in advance to prevent shortages and price hikes during Ramadan. The TCB's comprehensive package for TCB family cardholders also includes soybean or rice bran oil, pulses, and rice at subsidized rates, aiming to support the financially vulnerable segments of society.

 

Comprehensive Subsidy Program

Under the subsidy program, each TCB family cardholder is eligible to purchase not only chickpeas but also two litres of soybean oil or rice bran oil at Tk 100 per litre, 2 kilograms of pulse at Tk 60 per kg, and 5 kilograms of rice at Tk 30 per kg. This initiative is in line with the government's broader strategy to tame inflation and ensure that the populace can access essential commodities at reasonable prices during the high-demand period of Ramadan. The move also reflects the government's proactive approach to food security, as outlined by the Prime Minister earlier this month.

 

Implications and Future Prospects

The import of chickpeas and the announcement of subsidized rates for essential commodities are timely interventions that not only address immediate food security concerns but also showcase the government's dedication to public welfare. As Ramadan approaches, these measures are expected to alleviate financial pressures on households, particularly those in lower-income brackets. Moreover, the successful implementation of this initiative could serve as a model for future efforts to stabilize market prices and ensure food availability during critical periods. With the government taking concrete steps to support its citizens, the focus now shifts to the efficient distribution of these commodities to ensure they reach those in need.

As of 20 February, the tariff on imports of fresh, frozen and dried Chilean blueberries and cranberries has been cut from 30 per cent to 10 per cent. Canned or prepared cranberries will now have a standard tariff rate of 5 per cent, while similarly packaged blueberries will have a tariff of 10 per cent.

 

'This is very good news for our blueberry exports to India, since the Indian market has a special importance for Chilean exports,' said Iván Marambio, president of Frutas de Chile. 'This lower tariff for our blueberries makes us think about greater opportunities in India, a market that is expected to become the third largest economy in the world by 2030.'

 

Andrés Armstrong, executive director of the Chilean Blueberry Fruit Committee, said the decision was 'very positive' and would 'undoubtedly help facilitate the entry of this healthy fruit in a country with such great consumption potential as India'.

 

Despite its potential, India presents many logistical challenges for Chilean shippers. Armstrong said one solution would be for blueberry and cherry exporters to work together by loading both products in the same shipments and establishing joint promotional programmes in India.

 

According to Frutas de Chile, Chile exported nearly 30,000 tonnes of fresh fruit to India in 2022/23, of which blueberries accounted for nearly 120 tonnes.

The Siraj Hussain-led panel on the promotion of warehouse-based sale of agricultural produce has recommended that all warehouses, whether registered with WDRA or not, should be declared as deemed market yards (mandis) if they comply with the prescribed norms of State’s APMC Act/Rules. It has also been suggested that the Agriculture Ministry form a steering committee with major States for smooth and faster implementation.

 

The Expert Committee, headed by the former agriculture secretary, was set up in April 2023, is said to have submitted its report in December, and it was uploaded on the Ministry website on Monday. It has recommended a host of measures to promote warehouse-based sales, with a focus on e-Negotiable Warehouse Receipts (eNWRs) trading through eNAM and other registered e-trading platforms.

 

One of the key recommendations is the compulsory registration of all warehouses with a capacity of 1,000 tonnes or more with the Warehousing Development and Regulatory Authority (WDRA). It has also asked the government to provide credit at a subsidised interest rate when farmers avail it using eNWRs by extending the Kisan Credit Card (KCC) scheme for this purpose.

 

'All those warehouses, whether registered with WDRA or not but complying with the prescribed norms for markets set out in the respective State’s APMC Act/Rules, may be declared as deemed market-yards,' the panel also said. Further, it has suggested State governments give preference to WDRA-registered warehouses for declaring those as deemed market-yards, as only such godowns are mandated to issue eNWRs.

 

Panel to push declaration

'This would not require too much formalities at the level of APMCs/State Agricultural Marketing Boards and the State governments as WDRA has already completed extensive physical inspection of such warehouses before registration,' the panel said.

 

Suggesting the Department of Agriculture and Farmers’ Welfare to form a 'Steering Committee' with major States to push the declaration of warehouses as deemed market-yards, the panel said there is a need for appropriate legal provisioning in State’s APMC Acts, including the urgent notification of Rules 'The Steering Committee may also monitor and review the progress of the actual declaration or notification of deemed market-yards on the ground by holding regular meetings,' it said.

 

As it is mandatory for all warehouses under the Food Corporation of India (FCI), both its own and the ones leased out by private sector, to be registered with WDRA, the panel has said States should intensively promote registration of co-operative and private warehouses and undertake awareness programme among warehouse owners to encourage them to register with WDRA.

 

The committee also recommends making it mandatory that the second instalment of subsidy under any government scheme of Centre and States for warehouse construction be released only after registration with WDRA.

 

Focus on promoting eNWRs

In the first phase, focus should be on promoting warehouse-based primary trade via eNWRs through eNAM and other registered e-trading platforms, for the success of such trade on a large scale. Subsequently, a mechanism can be established to promote secondary trade, mostly happening from warehouses, via eNWRs through eNAM and other registered e -trading platforms, the panel said.

 

However, many agri-marketing experts differ on allowing secondary trade on e-NAM, as it will dilute the focus on helping farmers since there are several private sector online platforms already available for facilitating transactions between trader to trader (B2B).

 

The panel said that allowing secondary trade through eNAM and other registered e-trading platforms would necessitate the formulation of market rules covering trading procedure, payment, transaction charges, dispute settlements, etc.

 

The panel stated that allowing secondary trade through eNAM and other registered e-trading platforms would necessitate the formulation of market rules covering trading procedures, payments, transaction charges, dispute settlements, etc.

According to IVPA, the share of palm oil in total imports is expected to decline from 60% in 2022-23 to 54% due to low spread with soft oils

 

Indian Vegetable Oil Producers’ Association (IVPA) expects vegetable oil import to be at 16.2 million tonnes (mt) during the 2023-24 (October-September) edible oil season against 17.06 mt in 2022-23.

 

Presenting a paper on ‘Competitiveness of Palm Oil in Indian Markets’ at the UOB Kay Hian Palm Oil Outlook Seminar in Kuala Lumpur on Monday, Sudhakar Desai, Chief Executive Officer of Emami Agrotech Ltd and President of IVPA, said the share of palm oil in total imports is expected to decline from 60 per cent in 2022-23 to 54 per cent owing to very low spread with soft oils.

 

Stating that India drastically reduced import of soyabean oil in January-March due to a lack of hedging tool, he said it is expected to increase in April-September as many players attempted to lock the negative forward soyabean oil - palm oil spread. If the soya-palm spread continues to be zero for longer , then palm share can drop to 50 per cent. Soya-palm oil spread was more than $400 a tonne a year ago.

 

3.3% consumption rise

 

Consumption is expected to increase by 3.3 per cent due to a price fall and a supportive macro environment in India.

 

 

He said soft oils are expected to increase consumption share due to tight spreads. Supply chain disruptions such as the Red Sea issue and the expectation of good soyabean and rapeseed crops in India slowed down soyabean oil imports in the last few months. This helped palm oil prices to be resilient.

 

Desai estimated crude palm oil (CPO) price outlook at $900-940 a tonne (c&f) for April-June and at $840-900 a tonne (c&f) for July-September. He estimated it at $900-960 a tonne (c&f) for April-September for soyabean oil. For sunflower oil, he estimated it at $890-940 a tonne (c&f) for April-June and $900-950 a tonne (c&f) for July-September.

 

Globally, demand for oilmeals, energy prices, biodiesel policies in various countries, and geopolitical issues are expected to be the key price drivers. With elections at different origins and destinations, government manifestos would keep adding volatility to the markets, he said.

 

Mustard oil to the rescue

 

On palm oil production, Desai estimated that Malaysian production is likely to increase by 2.6 per cent to 19 mt and Indonesian output to be flat at 49.6 mt. The combined carry-out stocks of Indonesia and Malaysia are expected to be tighter by at least 300,000 tonnes in 2024, with March-April being the tightest months, especially in Malaysia, he said.

 

The IVPA president has projected Indian domestic oil availability at 9.23 mt during 2023-24 against 9.07 mt in 2022-23. He attributed this to the good mustard crop with a sizeable carry-out. He said the mustard crop has shown a remarkable 45 per cent surge during the year.

 

He said the Government might have to take the right steps if the rapeseed prices trade lower than MSP (minimum support price) levels, either by government procurement or by a general increase in import duties to support domestic oilseed crops.

 

Indian Industries have been recommending an increase in the duty differential of crude vegetable oils and refined vegetable oils to restrict the high volume of refined palm oil, he added.