New Delhi [India], June 23 (ANI): The government should use minimum support price (MSP) as a tool for both encouraging crops which are in short supply like oilseeds and pulses, and disincentivise crops such as wheat and rice which are in abundance, said edible oil industry body The Solvent Extractors' Association of India.

India fulfils a sizable portion of its edible oil and pulses needs via imports, and spends a large part of its foreign exchange reserves on them.

The industry body urged the Centre to offer higher MSP or special incentives, particularly to farmers from Punjab and Haryana, for shifting their area from rice to maize in kharif and to rapeseed or mustard from wheat in rabi crop.

Haryana are Punjab are the two major growers of the staple foodgrain.

Notably, the Government recently raised the MSP for groundnut by 5.41 per cent, sunflower seed by 6.40 per cent, and soybean by 8.86, purportedly to encourage the sowing of these crops on a large area of land.

Further, on monsoon, the industry body said it is heartening to note that India's annual monsoon rainfall has covered more than half of the country, while conditions are favourable for it to advance into central, northern and western regions during this week.

The monsoon's progress will help farmers accelerate sowing of summer-sown crops, which has been lagging due to below-normal rainfall in the first half of June, especially in central India.

"The latest Agri Ministry report indicates oilseed sowing is down by 18 per cent compared to same period of last year and reported at 475,000 hectare but now sowing has picked up due to revival of monsoon," it said.

The monsoon has covered all of southern and eastern India and most of the central state of Madhya Pradesh, the industry body said quoting India Meteorological Department's latest statement.

Moreover, on the Centre's recent announcement of tariff-rate quota on soybean and sunflower oil for imports of total of 4 million tonne, it said that zero duty could be disastrous in case price of these two commodities fall in the international market.

"Crude palmoil price crashed from the highest of $2,010 in March 2022 by $ 625, while soybean oil down by $384 and sunflower oil by $285. Also, considering the lifting of the export ban on crude palm oil by Indonesia, increase in availability of sunflower oil from Ukraine by road through neighboring countries and expected higher production of palm oil and soya oil in the world will push the price further down," it said.

By allowing imports at nil duty, the move can prove disastrous for our domestic oilseed farmers, it said.

"We have strongly suggested to the Government that TRQ is no longer required as the basic objective of reducing inflationary burden on consumers has already been met with massive fall in import prices of palm, soya and sun oil," the industry body said, adding that the need of the hour is to ensure markets don't slide further as it will dishearten our oilseed farmers and impact our long term goal of augmenting oilseed production in the country. (ANI)