Agri Business

Govt to issue price, demand forecasts for crops

TV Jayan | | Updated on: Dec 26, 2018
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First nation-wide, agri market intelligence system — to help farmers get better price — will become operational from next kharif

The government will give out price and demand forecasts for various major foodgrains and price-sensitive horticulture crops such as onions from the forthcoming kharif season helping farmers take informed decision on growing different crops, a senior official of the Agriculture Ministry said.

“We will be making pre-seasonal as well as concurrent forecasts on demand and price of select commodities. Farmers can use this as a valuable input while deciding on which crop to grow,” the official told BusinessLine.

“This would be exactly like the India Meterological Department’s (IMD) seasonal weather forecasts. The forecasts will be issued regularly (most probably on a fortnightly basis) during the sowing season,” he said. In addition to foodgrains — which cover 72 per cent of total cropped area in the country — horticulture crops such as potatoes, onions and tomatoes are covered in the initial stage.

Agriculture normally follows a cobweb model. When a particular commodity is in short supply in a season, prices go up. In the subsequent season, more farmers would tend to grow the same crop, leading to a crash in prices. The concurrent forecasts are given so that farmers could not only know the area sown for a particular crop till then, but also the fluctuation in its forecast prices. This will help a farmer grow some other crop, if the projected area is achieved. “We do not want our projections to be a cause of worry,” the official said.

In October this year, the Agriculture Ministry constituted a technical advisory committee (TAC) under the chairmanship of Ashok Dalwai, CEO of National Rainfed Area Authority (NRAA).

High-level committee

The committee also has several senior officials from the Agriculture, Commerce and Food Ministries as members, apart from Apeda Chairman and an IMD representative. Besides, the Director of the National Institute of Agricultural Economics and Policy Research of the Indian Council of Agricultural Research (ICAR-NIAP), Director of the Maharashtra Agricultural Prices Competitiveness Project and Chairman of the Karnataka Agricultural Prices Commission will also be part of the committee. This first-ever attempt to forecast price and demand for agricultural commodities is based on recommendations made by an expert panel on Doubling Farmers’ Income, headed by Dalwai. Over the last two years, the panel submitted a 14-volume report, which was accepted by the government.

According to the source, ICAR-NIAP will be the knowledge partner for the project, for the time being. The TAC, from time to time, would recommend commodities on which price and demand forecasting needs to be made by ICAR-NIAP. On Thursday, the TAC would sign a memorandum of understanding with some agricultural universities in the country. The plan is to set up centres in different places so that regional forecasts can be made.

Extending to other areas

Over a period of time, the government intends to extend such market intelligence system to all commodities including livestock. “This is to make Indian agriculture market-led so that farmers can get the right price for their produce,” the sources said.

There have been limited attempts in the past to set up agricultural market intelligence centres. This new forecasting model builds upon these previous efforts.

Published on December 27, 2018

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