Problem
Most farmers who sell MSP crops do not sell to government procurement
- National
- State
In NSO's 2019 survey, 14.5 per cent of agricultural households selling paddy in July–December 2018 sold any of it to a procurement agency, and 9.7 per cent of those selling wheat in January–June 2019; 23.7 and 20.8 per cent of the respective output sold was sold under MSP. An earlier estimate by the High Level Committee on restructuring the Food Corporation of India (2015), using NSSO data for 2012-13, found that only 6 per cent of all farmers in the country gained from selling wheat and paddy directly to a procurement agency. State-wise and crop-wise differences in procurement are large but are not quantified in this entry. Evidence confidence: High for the survey years.
2 sub-problems within this
Many farmers selling MSP crops are not aware of the MSP
Among agricultural households that reported selling the crop, 40.7 per cent of paddy sellers (July–December 2018) and 37.1 per cent of wheat sellers (January–June 2019) were aware of the minimum support price for it, and 30.3 and 27.2 per cent knew of a procurement agency. Evidence confidence: High for 2018-19.
Pulses and coarse cereals are barely sold to procurement agencies
In the same survey, sales to a procurement agency were reported by 1.4 per cent of households selling arhar (tur) in January–June 2019, by 3.5 per cent selling jowar and 2.1 per cent selling bajra in July–December 2018, and by 5.6 per cent selling groundnut. Evidence confidence: High for 2018-19.
Who is responsible
- Ministry of Consumer Affairs, Food and Public Distribution — Department of Food and Public Distribution · Ministry or Department
- Food Corporation of India · Constitutional or statutory institutionStatutory corporation that procures foodgrains for the central pool.
- Ministry of Agriculture and Farmers Welfare — Department of Agriculture and Farmers Welfare · Ministry or Department
- State Governments · State Government
Evidence and sources
- NSS Report No. 587: Situation Assessment of Agricultural Households and Land and Livestock Holdings of Households in Rural India, 2019 · Official data or datasetNational Statistical Office, September 2021. Highlights and Statements 4.9 (MSP awareness and sale), 4.11 (crop insurance), 4.12 (reasons for not insuring); indebtedness highlights (69.6% institutional, 20.5% moneylenders); technical advice highlights.
- Recommendations of High Level Committee on restructuring of FCI · Official statementMinistry of Consumer Affairs, Food & Public Distribution, 22 January 2015. Executive summary of the Shanta Kumar committee report; NSSO 70th round (2012-13) procurement-sale figures and the 6 per cent estimate.
Alongside this
Tomato, onion and potato prices swing sharply between years
The Department of Consumer Affairs reported an all-India average retail tomato price of ₹52 per kg on 8 August 2025, against ₹54 a year earlier and ₹136 in 2023. The Ministry of Food Processing Industries has told Parliament that tomato, onion and potato prices fluctuate with weather, arrivals from non-traditional areas, changes in sowing patterns and overlapping seasons, and that no study of its Operation Greens price-stabilisation scheme had been conducted as of February 2022. These are consumer prices. How the swings pass through to the prices farmers receive is not established by the sources used here. Evidence confidence: Medium — volatility is documented at retail; the effect on farmers is not quantified.
Regulated markets are far apart, and small farmers struggle to reach them
The Parliamentary Standing Committee on Agriculture reported in January 2019 that an APMC market served an average area of 496 sq km, against the 80 sq km recommended by the National Commission on Farmers in 2006, and that about 41,000 markets would be needed to meet that standard. It noted that small and marginal farmers face inadequate marketable surplus, long distances to APMC markets and a lack of transport, and that 4,600 of about 22,000 rural haats were to be upgraded under the GrAM scheme. The figures are quoted through PRS Legislative Research's summary of the report, and the market-density figure has not been updated in the sources used here. Evidence confidence: High for 2019; current density unverified.
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