Agri Business

Hiring charges of agri implements jump on rising fuel prices, lack of migrant labour

Rahul Wadke Mumbai | Updated on July 28, 2020 Published on July 28, 2020

 

The rise in fuel prices — petrol and diesel — have come at a very difficult time for farmers in Maharashtra. Migrant labour is in short supply due to the pandemic and hiring charges of agriculture implements, especially for small and medium farmers, has increased by at least 30 to 40 per cent.

Tomato farmer Suresh Navale from Akole taluka in Ahmednagar district told BusinessLine that before the price rise, tractors were available at ₹500 per hour, which today has increased by ₹650 to ₹700 per hour. Due to higher demand for mechanical implements, drivers and owners of these implements are overcharging.

Navale pointed out that last week in his own farm he had to use a JCB (earth moving equipment) for specific fieldwork. But hiring charges have increased from ₹1,000 per hour to ₹1,400 per hour. “How can a small farmer survive with such expenses?” he asked.

Dairy business, which is already in heavy losses due to lack of demand from restaurants and confectioneries on account of the lockdown, is facing further blues. Dairy farmer Shankar Dandge of Nandura taluk in Buldhana district said that due to the pandemic, dairies are not buying milk at beyond ₹24 per litre, which was ₹34 per litre before the Covid-19 outbreak. And now with higher fuel prices, milk is being sold at less than breakeven prices. Losses are mounting.

 

Bengaluru-based agriculture expert Jagadeesh Sunkad said that the rise in fuel prices will hit the sugar mills in Maharashtra very hard. Out of last year’s ₹2,750 per tonnefair and remunerative price (FRP), almost 22 per cent was harvest and transportation costs. Over and above the FRP, sugar mills gave the farmers a bonus too.

But with higher petrol and diesel prices, sugar mills may not be able to give the bonus to farmers in Maharashtra this year. In a way, the higher harvest and transportation costs will be a pass-through, which would ultimately have to be borne by the farmers, he said.

In western Maharashtra where sugarcane is mostly grown, workers are not available. They have to be transported in large groups from underdeveloped districts such as Beed, which is about 400 km away, which adds to the operating costs of the sugar mills, Sunkad added.

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Published on July 28, 2020
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