Chana farmers hold back stocks hoping for a price spin

In the villages of western Rajasthan farmers are now asking one question: If prices of guar seed have risen so spectacularly in the last one year on lower output why cannot prices of other farm produce move up similarly?

This question has prompted farmers in the villages of Bikaner district to hold back stocks of chana and wait for an appropriate price when they can sell. That “appropriate” price at this juncture is Rs 5,000 per 100 kg.

Chana prices in the mandis of Bikaner are ruling at Rs 3,800-4,000 per 100 kg.

Lower output

The country’s chana output in 2011-12 was lower by 8.2 lakh tonnes at 74 lakh tonnes. In Bikaner, a major chana trading centre, arrivals after the initial bout declined to a trickle as farmers held on to stocks hoping for further rise in prices.

So far in this season, chana arrivals in Nokhamandi in Bikaner district have not risen above 500 bags (1 bag = 100 kg) as against 2,500-3,500 bags in the same time last year.

Are farmers in Bikaner imprudent to hold on to chana stocks when monsoon is just round the corner? Some believe the risk of holding on to stocks could pay off but Rs 4,000 per 100 kg is a good price to start offloading the stocks.

“Guar has changed the mindset of people here,” said Mr Om PrakashMundhra of Nokha Commodity Services.

The stupendous gains in guar prices over the last one year, particularly in the early part of this year, have changed the fortunes of most guar farmers and traders.

Chana at Rs 4,000 per 100 kg is a good bargain as prices last year were Rs 2,400-2,500 per 100 kg.

Most farmers in this region grow guar along with other crop such as moth beans, mustard, chana, jeera, fenugreek and bajra.

Prices ‘quite good’

“Chana prices right now are quite good. They are neither too low nor too high,” said Mr Rajesh Saraswat, Managing Director, LTC Commercial Company (P) Ltd, a warehousing company.

At the Bikaner mandi , Saturday’s post-noon auctions of chana stocks saw prices at Rs 3,872-4,051 per 100 kg. The four lots that came up for auction were bought by Bhagwati Trading Company.

Mr Jagdish Prasad, the owner of the trading company, is hoping that prices move up so that he is able to make some profit. He plans to offload his stocks shortly.

Chana stocks can be held on as deterioration of the produce is minimal unlike many other crop, traders and farmers said.

“Today, farmers have the financial capacity to hold chana because they have made money in guar,” said Mr Radheshyam Kapadia, a trader at Nokhamandi.

(The trip to western Rajasthan was sponsored by National Commodity and Derivatives Exchange.)

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