(a) whether the price of agricultural produces have been facing a downward trend
particularly the cash crops during the last three years;
(b) if so, the details thereof; and
(c) the reasons therefor alongwith the steps taken to improve the situation?
MINISTER OF STATE IN THE MINISTRY OF AGRICULTURE (SHRI KANTI LAL BHURIA)
(a)&(b): According the Wholesale Price Index (1993-94=100), the prices of agricultural
commodities increased by 4.1% in 2003-04 compared with 3.4% in 2002-03. During 2004-05 (April -
January), the Wholesale Price Index (WPI) for agricultural commodities increased at relatively
lower rate of 2.8%. In regard to cash crops like oilseeds, raw rubber and raw cotton, the WPI
revealed a mixed trend. For oilseeds as a group, the WPI increased by 11% in 2003-04 compared
with 16.4% in 2002-03. During April 2004 to January 2005, the WPI for oilseeds increased at a
lower rate of 3.1%.
As regards raw rubber, the WPI increased by 18.1% and 16.3% respectively during 2002-03 and
2003-04. During April 2004 to January 2005, the WPI for raw rubber increased by 13.1%. As
regards raw cotton, the year 2003-04 witnessed a significant increase by 27.1% in WPI compared
with a decline of 4.4% in 2002-03. However, during April 2004 to January 2005, the WPI of raw
cotton declined by 4.5% which reflected higher production at home and abroad in 2004-05 compared
to 2003-04.
(c): The prices of commodities depend on supply and demand and the variations in supply vis-a-
vis demand affect prices. With a view to protecting the farmers from distress sale, the
Government has been announcing Minimum Support Prices (MSP) each season for major crops covering
cereals, pulses, oilseeds and cotton. The announcement of MSPs is backed by procurement by
designated agencies with a view to protecting the interests of farmers during periods of fall in
prices vis-a-vis MSPs.