Minimum Support Prices (MSP)
Kartavya Desk Staff
Source: TOI
Context: The Cabinet Committee on Economic Affairs (CCEA) approved revised Minimum Support Prices (MSP) for 14 Kharif crops for the 2025–26 marketing season.
About Minimum Support Prices (MSP):
• What is MSP? MSP is the minimum guaranteed price offered by the government to farmers for their crops, even if market prices fall. It protects farmers from distress sales and ensures income stability.
• MSP is the minimum guaranteed price offered by the government to farmers for their crops, even if market prices fall. It protects farmers from distress sales and ensures income stability.
• Who Determines It? MSP is recommended by the Commission for Agricultural Costs and Prices (CACP) and approved by the Cabinet Committee on Economic Affairs (CCEA).
• MSP is recommended by the Commission for Agricultural Costs and Prices (CACP) and approved by the Cabinet Committee on Economic Affairs (CCEA).
• When was MSP Introduced? First introduced in 1966–67 during the Green Revolution, primarily for wheat and paddy.
• First introduced in 1966–67 during the Green Revolution, primarily for wheat and paddy.
• MSP Calculation Method A2+FL Formula: A2 = Paid-out costs (labour, seeds, irrigation, etc.) FL = Imputed value of family labour Margin: Government ensures 50% or more margin over production costs.
• A2+FL Formula: A2 = Paid-out costs (labour, seeds, irrigation, etc.) FL = Imputed value of family labour
• A2 = Paid-out costs (labour, seeds, irrigation, etc.)
• FL = Imputed value of family labour
• Margin: Government ensures 50% or more margin over production costs.
• Crops Covered Under MSP Kharif Crops: Cereals: Paddy, Jowar, Bajra, Ragi, Maize Pulses: Tur (Arhar), Moong, Urad Oilseeds: Groundnut, Sunflower, Soyabean, Sesamum, Niger-seed Commercial: Cotton Rabi Crops: Wheat, Barley, Gram, Lentil (Masur), Rapeseed & Mustard, Safflower Commercial Crops: Copra, Jute and Toria and De-husked Coconut also covered under related MSPs. Key Features of MSP: Announced Twice Yearly: Declared before the Kharif and Rabi sowing seasons to guide farmers’ planting decisions. Prevents Exploitation: Ensures a minimum guaranteed price to protect farmers from market volatility and distress sales. Encourages Crop Diversification: Offers higher MSPs for pulses and oilseeds to shift focus from water-intensive cereals. Budget 2018–19 Mandate: MSP fixed at 5 times the cost of production (A2+FL) to ensure fair profits for farmers. Promotes Nutritional Crops: Higher MSP for millets and Shree Anna supports healthier diets and climate-resilient farming.
• Kharif Crops: Cereals: Paddy, Jowar, Bajra, Ragi, Maize Pulses: Tur (Arhar), Moong, Urad Oilseeds: Groundnut, Sunflower, Soyabean, Sesamum, Niger-seed Commercial: Cotton
• Cereals: Paddy, Jowar, Bajra, Ragi, Maize
• Pulses: Tur (Arhar), Moong, Urad
• Oilseeds: Groundnut, Sunflower, Soyabean, Sesamum, Niger-seed
• Commercial: Cotton
• Rabi Crops: Wheat, Barley, Gram, Lentil (Masur), Rapeseed & Mustard, Safflower
• Wheat, Barley, Gram, Lentil (Masur), Rapeseed & Mustard, Safflower
• Commercial Crops: Copra, Jute and Toria and De-husked Coconut also covered under related MSPs.
• Copra, Jute and Toria and De-husked Coconut also covered under related MSPs.
• Key Features of MSP: Announced Twice Yearly: Declared before the Kharif and Rabi sowing seasons to guide farmers’ planting decisions. Prevents Exploitation: Ensures a minimum guaranteed price to protect farmers from market volatility and distress sales. Encourages Crop Diversification: Offers higher MSPs for pulses and oilseeds to shift focus from water-intensive cereals. Budget 2018–19 Mandate: MSP fixed at 5 times the cost of production (A2+FL) to ensure fair profits for farmers. Promotes Nutritional Crops: Higher MSP for millets and Shree Anna supports healthier diets and climate-resilient farming.
• Announced Twice Yearly: Declared before the Kharif and Rabi sowing seasons to guide farmers’ planting decisions.
• Prevents Exploitation: Ensures a minimum guaranteed price to protect farmers from market volatility and distress sales.
• Encourages Crop Diversification: Offers higher MSPs for pulses and oilseeds to shift focus from water-intensive cereals.
• Budget 2018–19 Mandate: MSP fixed at 5 times the cost of production (A2+FL) to ensure fair profits for farmers.
• Promotes Nutritional Crops: Higher MSP for millets and Shree Anna supports healthier diets and climate-resilient farming.