Agro Commodities

Price commission needed to ensure fair price for farmers

ANM Mohibub Uz Zaman

30 October, 2020 12:00 AM printer

Price commission needed to ensure fair price for farmers

Experts have stressed the need for an agricultural commodity price commission to ensure a stable price environment for growers and farmers.

Bumper production does not always bring benefits to the growers as bumper production has pushes down wholesale prices at the grower level below the production cost in Bangladesh, they said.

“Unusual low prices at the grower level do not necessarily mean that the items will cost the consumers less.”

Akhter Ahmed, Country Representative of International Food Policy Research Institute (IFPRI), told the Daily Sun that a price commission needs to be formed ensure fair prices for farmers and save consumers from higher prices of commodities.

“The government should create a balance between farm and retail prices to ensure that the farmers get fair price of their produce and the consumers can also buy agro commodity at affordable prices,” he added.

“Lower price causes sufferings to the farmers and at the same time, high rice price also affects the consumers, particularly the low-income groups.”

He also added that in India, Agricultural Prices Commission became successful in ensuring fair prices for farmers and the consumers as well.

The Commission for Agricultural Costs & Prices (CACP since 1985, earlier named as Agricultural Prices Commission) came into existence in January 1965.

The CACP recommends minimum support prices (MSPs) of 23 commodities: seven cereals (paddy, wheat, maize, sorghum, pearl millet, barley and ragi), five pulses (gram, tur, moong, urad, lentil), seven oilseeds (groundnut, rapeseed-mustard, soyabean, seasmum, sunflower, safflower, nigerseed) and four commercial crops (copra, sugarcane, cotton and raw jute).

The price is being determined by analysing demand and supply, cost of production, price trends in the market, both domestic and international, inter-crop price parity, terms of trade between agriculture and non-agriculture and the likely implications of MSP on consumers of that product.

Effectively, the CAPC regarded itself as an arbitrator in the distribution of real incomes between producers and consumer, with cost-plus as its intellectual foundation.

Consumers Association of Bangladesh (CAB) President Golam Rahman said the Department of Agriculture Market (DAM) can fixed agro product prices at the growers level, wholesale level and retail level according to The National Agriculture Policy 2018.

Mohammad Yousuf, Director General of Department of Agricultural Marketing, told the Daily Sun that recently they fixed cold storage, wholesale and retail price of potato in the country.  He said they will fix growers level, wholesale and retail prices of other agro commodities gradually after discussion with the all stakeholders.

The market price for agricultural produce many times tends to be unstable and volatile, which may result into undue losses to the farmers or growers and discourage adoption of the modern technology and required inputs. The government’s price policy for agricultural commodities seeks to ensure remunerative prices to the growers for their produce with a view to encourage higher investment and production and to safeguard the interest of consumers by making available supplies at reasonable prices with low cost of intermediation.