Zee Business Exclusive: Centre plans action to curb retail prices of pulses, say sources

With an aim to control the retail prices of pulses ahead of the summer season and general elections, the Ministry of Consumer Affairs, Food and Public Distribution on Tuesday called a meeting with stakeholders such as importers, millers, stockists, and state officials the next day to discuss a host of issues including the stocks of imported pulses lying at customs. The upcoming meeting follows deliberations between government authorities and state procurement agencies such as NAFED and NCF. 

The action is the latest in a range of moves to counter price fluctuations in pulses caused due to prevalent issues such as hoarding by key stakeholders. 

On April 5, the government met the Chief Secretaries of states and directed them to investigate whether the stock disclosure norms were being followed diligently. 

The government may form teams to investigate the situation of the supplies in the states and tally the findings with import and custom data, sources told Zee Business. 

It is preparing stern action against instances of hoarding and black-marketing by the stakeholders in this regard, with a special focus on pulses, they added. 

The central government has reintroduced a mandatory declaration of pulses stocks by the stakeholders from April 15, with an aim to control inflation in the segment. It introduced the measures, applicable to importers, millers, stockists, traders and processors, in June through December last year. 

Meanwhile, the central government began the procurement of chana (gram) from growers at a minimum support price (MSP) for maintaining the buffer stock to check prices and meet the demand of those states which want to distribute under their welfare schemes. 

It also directed states to make sure traders, importers, and millers declare their stock position of pulses effective from April 15 in a bid to check hoarding and contain price rise.

The MSP for chana for the 2024-25 rabi marketing season stands at Rs 5,440 per quintal.

Cooperatives NAFED and NCCF are undertaking chana procurement as part of the price stabilisation fund (PSF) scheme to ensure sufficient supplies of pulses in the market to ensure fair retail prices of such commodities for the consumer.

Currently, the government is holding a buffer stock of 10 lakh tonne of raw chana procured under the PSF.

What is hoarding how does it impact market prices?

Hoarding is a practice of accumulating goods in excess of what is needed which can have significant repercussions on market prices. The act of stockpiling goods, often driven by various factors such as fear of scarcity, speculation, or anticipation of price hikes, is known as hoarding. 

Hoarding tends to directly impact market prices by creating artificial scarcity and increasing demand. When individuals or entities hoard essential commodities, it disrupts the supply-demand equilibrium, leading to price inflation. Hoarding can cause price volatility, making it challenging for consumers to access essential products at reasonable prices. Hoarding can also distort market dynamics, affecting producers and consumers alike.

With inputs from agencies