Tur price up 7% in spot mandis on import duty levy
Tur prices jumped 7 per cent in the last two days on estimates of lower supply following the government’s decision to levy a 10 per cent import duty on it.
Data compiled by the National Commodity and Derivatives Exchange (NCDEX) showed the local variety of tur at Rs 4,700 a quintal in the Akola mandi on Wednesday, a rise of Rs 300 from Monday. Tur has been trading lower than its minimum support price (MSP) of Rs 5,050 a quintal, including a Rs 425 bonus, for a few weeks.
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Food Corporation of India (FCI) has procured tur from farmers for the first time this year, but its price has continued to disappoint farmers who expanded its acreage in the previous kharif season because prices were hovering at Rs 120-140 a kg.
“But the price of tur fell to Rs 6,000-6,500 a quintal, resulting in whole, unprocessed tur quoting at Rs 4,400-4,500 a quintal. This price is non-remunerative. Tur (whole, unprocessed) below Rs 60-65 a kg is not profitable for farmers, prices must rise by 25-30 per cent for farmers to continue its cultivation," said Himat Chandra, partner, Trimurthi International, a wholesaler in the Vashi mandi. The agriculture ministry estimates India’s tur output at 4.23 million tonnes in 2016-17, almost double the previous year’s 2.56 million tonnes.
With farmers realising prices below the minimum support level, the government levied a 10 per cent duty on tur imports. India imports around 500,000 tonnes of tur every year, but this year these are likely to be edged out by local supplies. Traders said the government wanted tur prices to trade above the MSP. The import duty was designed to raise local prices, they added.
“India is the only country where tur is consumed. Even with the import duty, overseas producers will sell to Indian buyers. At the most they will reduce prices by 5 per cent. Buyers will have to absorb the other 5 per cent," said Bimal Kothari, vice-chairman, Indian Pulses and Grains Association (IPGA).
Traders also said the import duty was unlikely to change anything. India imports tur primarily from least developed countries that receive preferential trade treatment. Despite the duty, tur imports would come in duty-free, they added.