Minimum support price (India)

The minimum support price (MSP) is an agricultural product price, set by the Government of India to purchase directly from the farmer. This is not enforceable by law. By definition, this rate is to safeguard the farmer to a minimum profit for the harvest, if the open market has lesser price than the cost incurred.[1] The Indian government sets the price for 23 commodities twice a year.[2][3][4]

MSP is fixed on the recommendations of the Commission for Agricultural Costs and Prices (CACP) since 2009.[5]

Calculating MSP

Since 2009, the Commission for Agricultural Costs and Prices fixes the MSP of a crop based on:

• cost of production
• demand
• supply
• price fluctuations
• market price trends
• different costs and
• international market prices
• agricultural wage rate

Commodities under MSP

A total of 23 commodities are covered by MSP mechanism:[2]

• Cereals:

1. Paddy
2. Wheat
3. Maize
4. Sorghum
5. Pearl millet
6. Barley
7. Ragi

• Pulses:

1. Chickpea / Gram / Gramme
2. Tur
3. Moong
4. Urad
5. Lentil

• Oilseeds:

1. Peanut
2. Rapeseed
3. Soyabean
4. Sesame
5. Sunflower
6. Safflower
7. Niger seed

• Commercial crops:

1. Copra
2. Sugarcane
3. Cotton
4. Raw jute

Minimum Support Prices - Fixed by Government (Rs. per quintal)[6]

Commodity	Variety	2010-11	2011-12	2012-13	2013-14	2014-15	2015-16	2016-17	2017-18	2018-19	2019-20	2020-21
KHARIF CROPS
PADDY	Common	1000	1080	1250	1310	1360	1410	1470	1550	1750	1815	1868
	Grade 'A'	1030	1110	1280	1345	1400	1450	1510	1590	1770	1835	1888
JOWAR	Hybrid	880	980	1500	1500	1530	1570	1625	1700	2430	2550	2620
	Maldandi	900	1000	1520	1520	1550	1590	1650	1725	2450	2570	2640
BAJRA		880	980	1175	1250	1250	1275	1330	1425	1950	2000	2150
MAIZE		880	980	1175	1310	1310	1325	1365	1425	1700	1760	1850
RAGI		965	1050	1500	1500	1550	1650	1725	1900	2897	3150	3295
Tur (Arhar)		3000	3200	3850	4300	4350	4625^	5050^^	5450^	5675	5800	6000
MOONG		3170	3500	4400	4500	4600	4850^	5225^^	5575^	6975	7050	7196
URAD		2900	3300	4300	4300	4350	4625^	5000^^	5400^	5600	5700	6000
COTTON	Medium Staple	2500	2800	3600	3700	3750	3800	3860	4020	5150	5255	5515
	Long Staple	3000	3300	3900	4000	4050	4100	4160	4320	5450	5550	5825
Groundnut		2300	2700	3700	4000	4000	4030	4220*	4450^	4890	5090	5275
SUNFLOWER SEED		2350	2800	3700	3700	3750	3800	3950*	4100*	5388	5650	5885
SOYABEAN	Black	1400	1650	2200	2500	2500	-	-	3050^	3399	3710	-
	Yellow$$	1440	1690	2240	2560	2560	2600	2775*				3880
SESAMUM	-	2900	3400	4200	4500	4600	4700	5000^	5300*	6249	6485	6855
NIGERSEED	-	2450	2900	3500	3500	3600	3650	3825*	4050*	5877	5940	6695
RABICROPS
WHEAT		1120	1285	1350	1400	1450	1525	1625	1735	1840	1925	1975
BARLEY	-	780	980	980	1100	1150	1225	1325	1410	1440	1525	1600
GRAM	-	2100	2800	3000	3100	3175	3500**	4000^	4400!	4620	4875	5100
MASUR (LENTIL)	-	2250	2800	2900	2950	3075	3400**	3950!	4250*	4475	4800	5100
Rapeseed & Mustard	-	1850	2500	3000	3050	3100	3350	3700*	4000*	4200	4425	4650
SAFFLOWER	-	1800	2500	2800	3000	3050	3300	3700*	4100	4945	5215	5327
TORIA	-	1780	2425	2970	3020	3020	3290	3560	3900	4190	4425	-
OTHER CROPS
COPRA	Milling	4450	4525	5100	5250	5250	5550	5950	6500	7511	9521	9960
(Calendar Year)	Ball	4700	4775	5350	5500	5500	5830	6240	6785	7750	9920	10300
DE-HUSKED COCONUT Calendar Year)		1200	1200	1400	1425	1425	1500	1600	1760	2030	2571	2700
JUTE		1575	1675	2200	2300	2400	2700	3200	3500	3700	3950	4225
** Including Bonus of Rs.75 per quintal.
^ Includin Bonus of Rs. 200 per quintal .
^^ Including Bonus of Rs. 425 per quintal .
* Including Bonus of Rs. 100 per quintal .
$$ Minimum of Support Price of Soyabean yellow is also applicable to black variety during 2015-16 and 2016-17.
! Including Bonus of Rs. 150 per quintal.

See also

• 2020–2021 Indian farmers' protest

References

1. Budget 2018 on Agriculture: Can new MSP prop up rural economy? - Livemint
2. "CACP". cacp.dacnet.nic.in. Commission for Agricultural Costs and Prices. Retrieved 24 September 2020.
3. Budget 2018: Focus on MSP ideal for tackling farm distress - The Economic Times
4. Agriculture
5. "Calculation of MSP". pib.gov.in. Ministry of Agriculture & Farmers Welfare. 3 March 2020. Retrieved 2020-12-05.CS1 maint: others (link)
6. "Minimum Support Prices". farmer.gov.in. Retrieved 2020-12-25.

Further reading

• Aditya, K.S.; Subash, S.P.; Praveen, K.V.; Nithyashree, M.L.; Sharma, Akriti; Bhuvana, N. (7 August 2017). "Awareness about Minimum Support Price and Its Impact on Diversification Decision of Farmers in India". Asia & the Pacific Policy Studies. 4 (3): 514–526. doi:10.1002/app5.197. S2CID 158304705 – via onlinelibrary.wiley.com.
• Evaluation Study On Efficacy of Minimum Support Prices (MSP) on Farmers (DMEO Report No.231) (PDF) (Report). NITI Aayog: Development Monitoring and Evaluation Office. Government of India. January 2016. Retrieved 5 December 2020.