Centre slaps stock limit on tur and chana till September to ensure affordability

The Centre on Friday imposed stock limits on tur (pigeon pea) and chana (Bengal gram) till September amid persistent concern about a spike in prices and crop failure hitting supplies.

September is when the monsoon season ends, before kharif harvests kick off a month later.

The stock limit will be applicable with immediate effect to wholesalers, retailers, big chain retailers, millers and importers.

The move is aimed at preventing hoarding and speculation, while ensuring affordability to consumers, after the failure of a string of such measurres in the recent past.

Mint had earlier reported that the Centre was mulling imposing a stock limit on two crucial pulses—tur or arhar and chana–till September when southwest monsoon withdraws from the country, and kharif crops start getting harvested a month later.

Read | Cabinet approves increase in MSP of 14 kharif crops for 2024-25 season

The stock limit set for each pulse is 200 tonnes for wholesalers; 5 tonnes for retailers; 5 tonnes at each retail outlet; 200 tonnes at depots for big chain retailers; and the last 3 months of production or 25% of annual installed capacity, whichever is higher, for millers, an official statement said.

Importers are not to hold imported stock beyond 45 days from the date of Customs clearance. The respective legal entities are to declare the stock position on the portal (https://fcainfoweb.nic.in/psp) of the Department of Consumer Affairs and in case the stocks held by them are higher than the prescribed limits then, they shall bring it down  to the prescribed stock limits by 12 July, it said.

Read | In 100-day agenda, food processing ministry to incorporate reduction of food wastage in supply chain

The imposition of stock limits on tur and chana is the latest move by the government to try and  bring down the prices of essential commodities. 

The Department of Consumer Affairs had been closely monitoring the stock position of pulses through its stock disclosure portal. The department had, in first week of April, asked state governments to enforce mandatory stock disclosure by all stockholding entities, which was followed up with visits to major pulses producing states and trading hubs.

Separate meetings with traders, stockists, dealers, importers, millers and big chain retailers were also held to encourage and sensitize them about truthful disclosure of stocks and keeping affordable pulses for consumers.

Prices of pulses have been rising for over a year now. Tur and chana have shot up to ₹ 11,100-12,250 per quintal in Maharashtra’s Solapur and ₹ 7,075-7,175 per quintal in Delhi’s key markets that get supplies from Madhya Pradesh and Rajasthan. This compares with their minimum support prices (MSPs) of ₹ 7,000 and ₹5,440 a quintal, according to spot traders.

Production—especially the two major pulses tur (a kharif crop) and chana (rabi or winter crop)—has fallen for two consecutive crop years (2022-23 and 2023-24) because of unseasonal rains, deficit rainfall and prolonged dry spells in major growing states.

And this | Monsoon to gather pace next week; cover country ahead of schedule, says private forecaster Skymet

In the retail market, the all-India average price of tur dal was ₹ 161.3 a kg, an increase of 25.6% year-on-year while chana was ₹ 88.2 per kg, up nearly 18% on year, as per data available from the consumer affairs ministry on Friday.

Though the headline inflation fell to 4.75% in May from 4.83% in April, the lowest in a year, food inflation, which accounts for nearly 40% of the overall consumer price basket, remained unchanged. It was 8.69% in May and 8.70% in April. By comparison, it was 3% a year ago. 

Inflation in pulses in particular moved up to 17.1% in May from 16.8% a month ago and 6.6% a year ago.

Aware of the drop in production, the union government has taken several measures to arrest soaring prices, including imposition of stock disclosure and stock limits last year and allowing duty-free imports of yellow peas, but to no avail.

The government had reduced import duty of 66% on desi chana on 4 May to augment the domestic production. The duty reduction facilitated imports and led to higher sowing of chana in major producing countries. 

As per reports, chana production in Australia is estimated to have increased from 500,000 tonnes in 2023-24 to 1.1 million tonnes in 2024-25 which is expected to be available from October 2024 onward.

Sowing of Kharif pulses like tur and urad is expected to increase significantly in this season due to high price realization by farmer and above-normal monsoon rains predicted by IMD.

Further, shipments of current year crops of tur from East African countries is expected to arrive from August 2024 onward.

These factors are expected to help in bringing down the prices of Kharif pulses in the coming month, the statement read. 

Also | Centre announces infrastructure projects, farmer support as part of 100 day programme

Meanwhile, Deepak Pareek, agriculture economist and convener Global Grains and Pulses Council, said: “The government's early intervention to impose stock limits on key pulses is premature and counterproductive. It will discourage importers from bringing chana and tur to India, keeping supplies at the origin. This move also sends a negative message to farmers, especially before sowing, suggesting that government intervention occurs when they have the chance for better earnings. Additionally, the stock limit will provide only temporary price relief for three to four weeks, after which prices will rise again due to the supply-demand gap.”