Muzaffarpur, Bihar
After toiling day and night in his five-and-half acre farmland for seven to eight months during the pandemic, all that 45-year-old Rajiv Kumar Singh earned were losses. His golden-brown rabi wheat crop was ready about 10 days ago. He was hoping to sell it at the government fixed minimum support price (MSP) of Rs 1,975 per quintal. But, he ended up selling it for Rs 1,550 a quintal, incurring a loss of Rs 425 per quintal (one quintal equals 100 kilogrammes).
“My wheat crop is ready and harvested, but the government has not yet started the procurement process. So far I have sold twenty quintals of wheat at the rate of one thousand five hundred and fifty rupees a quintal,” Rajiv Kumar from Gharbhara village in Muzaffarpur, told Gaon Connection. “As soon as the wheat is cut, the mahajan (the village moneylender) comes to the door demanding to be paid back. So, I have to sell the wheat to the aadhityas [middlemen] as the government has still not started procuring wheat,” he lamented.
Another crop and another set of losses. That too amid the raging second wave of COVID19 pandemic in the country when restrictions and lockdowns are making a comeback threatening to push farmers deeper into misery. Gaon Connection had earlier reported how farmers in Bihar were forced to sell their paddy crop to aadhityas, who, in turn, sell it to the traders in Punjab and Haryana to reap profits.
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Bihar accounts for 5.7 per cent of the total wheat production in the country. Statistics show that wheat over 233,000 hectares area has been cultivated in Bihar this year. According to a central government release, Bihar has set a target of purchasing 100,000 metric tonnes of wheat this year.
Wheat large-scale harvesting began in Bihar more than 10 days ago, and it will end in another fortnight. But, the state government is yet to start procuring it. This delay is only providing grist to the nexus of traders and middlemen to fill their pockets.
“Last year, I got one thousand six hundred rupees a quintal of wheat, this time the aadhityas are paying only one thousand five hundred and fifty rupees a quintal,” Randhir Kumar from Sultanpur village in Samastipur, told Gaon Connection. The 46-year-old wheat farmer pointed out how while the price of seeds, fertilisers and diesel (for irrigation) increased many times over in the past one year, the price he is getting for his produce has actually decreased. Nevertheless, he is going to sell the 24 quintals of wheat he has harvested to the aadhatiyas in a couple of days as he has no choice but to do so, he said. “It is insensitivity on the part of the government that the farmers of Bihar are suffering. If there were mandis where the purchase of grains at MSP was made mandatory, then we would get the right price,” he said.
Because of the government dragging its feet on procurement, the beleaguered farmers are forced to sell to middlemen and traders who dictate the terms and price. The farmers are usually left with no option but to sell to them.
“The procurement decision is taken by the top officials of the department. So we can’t do anything about it,” a Muzaffarpur district level official told Gaon Connection. As per media reports, the cooperative department of Bihar had declared that the procurement of wheat would start from April 15, but later changed the date to April 20 through the state’s PACS and vyapar mandals. Last year the procurement began on April 15.
Wheat procurement in Bihar
In Bihar, the Primary Agricultural Credit Society (PACS), that is a panchayat and village level unit, extends rural credit to farmers and also provides marketing assistance to help them sell their product at a good price. The Agricultural Produce Market Committee (APMC) Act in Bihar was abolished in the year 2006 and the state government had then stated that food grains would henceforth be purchased from the farmers through the PACS and vyapar mandals.
There are 8,463 PACS in Bihar, which have specific targets when it comes to procuring foodgrain. Apart from this there are also 500 vyapar mandals that also procure the foodgrains.
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According to Vandana Priyadarshi, secretary of the co-operative department, farmers who have registered themselves in the agriculture department portal can sell wheat through PACS and vyapar mandals. “The government has set a target of buying one lakh metric tonnes of wheat, but if more wheat comes, it will also be purchased,” Priyadarshi said at a media briefing.
However, the ground reality is far different. The wheat farmers are forced to sell their produce to the aadhityaa or middlemen at a price much lower than the MSP because the Bihar government has not yet started purchasing wheat through these PACS and vyapar mandals.
“We have not yet officially received any notification about when wheat procurement will begin,” the chairperson of a PACS operating in a rural area of Patna told Gaon Connection on condition of anonymity. “Even after the government procurement starts, most farmers are not able to benefit from it as we have to borrow money from cooperative banks to pay them and that process takes time,” he said.
Farmers cannot afford to wait for the government to begin procurement as they have no access to storage space, and they need immediate money to repay loans they have incurred.
“If we keep wheat in the house, it will be ruined because the rainy season will start soon. If not the rains, the insects will destroy the grains,” Vivek Kumar, another farmer from Gharbara village in Muzaffarpur, told Gaon Connection. He was compelled to sell 10 quintals of wheat to the aadhitya at the rate of Rs 1,550 per quintal.
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Farmers claim there was no getting away from debt as the cost at which they sell their produce — wheat or paddy — does not even recover the amount they invest in cultivating the crop. “We have to borrow money to survive,” Rajiv Kumar said despondently.
“But, if the government purchases the grain at the MSP at the right time, our problems would be solved,” he added.
Farmers left in the lurch
In the rabi season of 2018-19, Bihar government procured 18,000 tonnes of the 6.1 million tonnes of wheat produced. This is less than half per cent of the total wheat production. In the following season of 2019-20, the procurement was 30,000 tonnes out of approximately 5.6 million tonnes. This was disclosed by the Ministry of Consumer Affairs, Food and Public Distribution on February 4, last year. This is approximately 0.54 per cent of the total wheat produced in the state that year.
According to a press release issued by the Ministry of Agriculture only 554 farmers in the rabi season 2019-2020, and 1,002 farmers in the rabi season 2020-2021 were able to sell wheat to the government at MSP. There are nearly 10.5 million farmers cultivating wheat in Bihar.
Predictably, procurement by the Bihar government was much lower than the other major wheat producing states of the country like Punjab, Haryana, Madhya Pradesh, Rajasthan and Uttar Pradesh.
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How Bihar’s wheat ends up in Odisha
Local middlemen buy wheat from farmers in Bihar and sell it to traders in far off Odisha. The farmers have no say on the price they get for their wheat. It is the aadhityas who fix the price. That in turn is decided by the traders in the states the wheat is sold, mainly in Odisha and Punjab.
“Odisha traders tell us about the maximum price wheat can be purchased at. Accordingly, the aadhatiyas buy wheat from the farmers,” a trader from Bihar, on condition of anonymity, told Gaon Connection.
The aadhatiya pays the farmer Rs 1,550 per quintal. He then sells it to local traders at Rs 1,650 per quintal. They in turn sell it to the bigger traders at Rs 1,670 per quintal excluding the transport cost, and make a profit of Rs 20 per quintal.
The trader, who works from Muzaffarpur Bazaar Samiti (formerly an APMC market), has sold 100 tonnes (about 1,000 quintals) of wheat to an Odisha trader in the last fortnight. “Wheat arrivals have increased in the market in the past one week and, hopefully, there will be more wheat in the coming days as the wheat harvesting will end in Bihar in 10-15 days,” he said.
There is reluctance on the part of the state government to procure wheat from the farmers and hence the delay in procurement, Patna-based economist NK Chaudhary told Gaon Connection. “If the government wanted to, it could easily buy the food grains from the farmers, but it does not want to,” he said.
Meanwhile, as the state government of Bihar continues to be indecisive about the date of procurement of wheat, the farmers with their back to the walls are handing over their produce to aadhatiyas at a price that spells loss to them.
