Financial Daily from THE HINDU group of publications
Thursday, Mar 31, 2005
Agri-Biz & Commodities
Spices & Condiments
Chilli stocks piling up at Guntur yard; prices crash
Guntur , March 30
CHILLI stocks have piled up at the Guntur chilli market yard, the largest in the State, as transactions were disrupted for the past three days due to agitation by farmers seeking market intervention.
Prices have crashed to below Rs 2,000 per quintal for the fair average quality varieties and even for the finer varieties the prices have not crossed Rs 2,500 a quintal.
It is estimated that at present as much as 2 lakh bags of chilli (each bag weighing 40 kgs) is piled up in the yard.
On Monday and Tuesday, farmers blocked traffic on the Guntur-Chilakaluripeta road for long hours and staged demonstrations in front of the yard urging the Government to take up market intervention immediately through Markfed (the State Marketing Federation).
There were no transactions on those two days and on Wednesday transactions resumed, but due to low prices the farmers were not willing to sell. Only 25,000-30,000 bags of chilli were traded on the day.
The Markfed officials said the State Government had written to the Union Government and Nafed seeking permission to take up market intervention.
The State and the Centre would have to bear the cost of the operation in the 50:50 ratio.
Last year, the State Markfed entered the market in the second week of March to procure chilli and prop up the price line.
The Markfed incurred heavy losses, as it could not liquidate the stocks. It is still stuck with some old stocks. The loss is estimated at Rs 65 crore. In this backdrop, Markfed is unable to enter the market and procure chilli till the Centre clears the proposal.
Farmers are hopeful that the State Government would act fast and facilitate market intervention by next week at least. Otherwise, it is apprehended, there may be a further fall in prices.
Stories in this Section
The Hindu Group: Home | About Us | Copyright | Archives | Contacts | Subscription
Group Sites: The Hindu | Business Line | The Sportstar | Frontline | The Hindu eBooks | The Hindu Images | Home |
Copyright © 2005, The
Hindu Business Line. Republication or redissemination of the contents of
this screen are expressly prohibited without the written consent of
The Hindu Business Line