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Traders cry foul over stock limit on pulses

By Sanjeeb Mukherjee
July 06, 2021 15:42 IST
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The edible oil trader and industry is also up in arms against the decision to allow unrestricted import of refined oils and lower the import duty on crude.

On a day when several mandis across the country are closed in protest against the recent Centre’s decision to impose stringent stock-holding limit on pulses, the government clarified that limits have been defined as retail prices are still higher than last year though there is some moderation in the last few weeks.

It said the same logic also holds true for edible oils, the import duties on which was slashed few days back and curbs lifted on import of refined oils.


The decision on edible oil and pulses have caused massive resentment among the trading community as it came just ahead of the kharif sowing season, when prices were off their peaks due to multiple steps announced previously.

Sources said trading activity in some of the major mandis dealing in pulses such as Sholapur, Amravati and Latur in Maharashtra, Indore and Dewas in Madhya Pradesh along with Kanpur in Uttar Pradesh was impacted as traders went on a flash strike in protest against the decision to impose stock limits.

“This decision of the government has come as a thunderbolt to the traders as they will now be compelled to sell pulses purchased from farmers at high prices at low rate causing economic loss to them,” Rahul Chauhan, of iGrain India, a commodity research firm said.

He said though the limits are applicable only till October 31, 2021, traders will still be wary of purchasing at a high price from farmers over fears of crackdown leaving everything for the public procurement system.

However, food secretary Sudhanshu Pandey said the move to impose the stock limit on pulses and also lowering import duties on edible oils have been taken now as though prices have come off their peaks but they are still higher than last year.

He was replying to a question on whether the Centre’s decision to impose stock holding limit on pulses and sharply cut duties on crude edible oil while allowing free imports of refined oil has come slightly late in the day.

"Barring masoor dal, prices of all other pulses have declined continuously in the last 4-5 weeks both in retail and wholesale markets," he said.

For instance in Delhi, retail prices of pulses have declined up to Rs 7/kg in one month.

The India Pulses and Grains Association (IPGA), meanwhile, in a statement said that there is need to regulate the retail prices of pulses because the spread between the wholesale and retail price is fairly large in major cities.

It said that a survey done by IPGA in June 2021 shows that the gap between wholesale and retail prices of pulses is big.

"IPGA believes that the government is targeting the wrong sector.

"They are focusing on the traders, whereas they actually need to conduct an in-depth scrutiny and monitoring of the gap between the wholesale and the retail prices," vice chairman of IPGA Bimal Kothari said in a statement.

Meanwhile, the edible oil trader and industry is also up in arms against the decision to allow unrestricted import of refined oils and lower the import duty on crude.

Both the Solvent Extractors Association (SEA) and Central Organisation of Oil Industry and Trade (COOIT) in separate statement said that allowing unrestricted imports of refined palm oils as per the latest government order will have serious repercussions for the domestic refiners but also for the oilseeds farmers as their prices will crash just at a time when planting is about to start.

“The action will surely send the domestic industry on the brink of bankruptcy as we have seen in the past with so many refiners.

"The situation was looking up after a ban on import of refined oils was imposed in January 2020, but we are back to square one,” SEA said. COOIT said it will lead to flooding of cheap edible oils from SAARC nations.

Photograph: PTI Photo

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Sanjeeb Mukherjee
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