Kerala becomes first state in the country to fix floor price for vegetables, rates to be effective from Nov 1

Kerala has become the first state in the country to set floor prices of 16 varieties of vegetables, Kerala CM Pinarayi Vijayan informed today (October 27). He said that The scheme would come into effect from November 01, 2020.

In his address through video-conferencing, the Chief Minister said, “This is the first time the floor price is being fixed for vegetables produced in the state and this is the first for a state in the country also. This is going to provide relief as well as support for the farmers. Farmers across the country are not satisfied but for the last four and half years, we have supported the farmers and the government has taken up several initiatives primarily targeted at the development of agriculture in the state."

The 16 varieties for which base prices (per kg) have been announced in the first phase are: tapioca (Rs 12), banana (Rs 30), Wayanadan banana (Rs 24), pineapple (Rs 15), ashgourd (Rs 9), cucumber (Rs 8), bitter gourd (Rs 30), snake gourd (Rs 16), tomato (Rs 8), beans nadan (vallipayar) (Rs 34), lady's finger (Rs 20), cabbage (Rs 11), carrot (Rs 21), potato (Rs 20), beans (Rs 28), beetroot (Rs 21), and garlic (Rs 139).

How will the Base Price mechanism work?

The base price mechanism will function like the MSP system. Under the new mechanism, the government will procure the commodity from the farmer at the base price if the market price of some vegetable or fruit falls below the stipulated base price, and the amount thereafter will be credited to the farmer's account.

"The floor price will be 20% above the production cost of the vegetable. Even if the market price goes below the floor price, the produce will be procured at the floor price from the farmers. The produce will be graded as per the quality and the floor price will be fixed based on the quality. 16 varieties of vegetables would be covered in the first phase and there is a provision to revise the floor price on a regular basis,” Vijayan added.

LSG bodies will have an important role to play in this scheme as they would be coordinating the procurement and distribution of vegetables. The scheme would benefit a farmer with a maximum of 15 acres of vegetable cultivation per season.

Further, they can register on the agriculture department’s registration portal after insuring the crop to get the benefit of the floor price. The registration would start from November 01. The scheme also envisages setting up the entire supply chain process like cold storage facilities and refrigerated vehicles for transporting the produce.

To become eligible, farmers have to upload the area of their farmland, data on sowing, expected harvest, and harvest time before the season on the web portal www.aims.kerala.gov.in. The AIMS mobile app is downloadable from Google Play Store.

At present, the Centre declares Minimum Support Price (MSP) for 22 products, primarily grains, pulses and oilseeds, paddy and copra, ahead of the season. Only the MSP for paddy and copra are mainly relevant in the case of Kerala, according to the Agriculture Department.