Average market price of major food crops below MSP

23-May-2025 05:07 PM

Mumbai. The latest bulletin of the Reserve Bank of India (RBI) stated that due to bumper production during the Kharif and Rabi seasons, the average market prices of most major food crops, except wheat, have fallen below the Minimum Support Price (MSP).

High-frequency food price data released for the month of May shows a slight softening in the prices of grains and pulses across the board as of May 19.

The Central Government sets MSPs for 23 crops—16 from the Kharif season and 7 from the Rabi season. However, regular procurement at the MSP mainly occurs for two key food grains: paddy (rice) and wheat.

Other crops are purchased only when necessary. For food security purposes, large-scale procurement of rice and wheat into the central pool is conducted every year.

The RBI's article for the month of May on the state of the economy also highlighted that edible oil prices remain firm. Notably, the prices of soybean oil, sunflower oil, and mustard oil have increased, while those of palm oil and peanut oil have declined slightly. The report suggests that this price trend needs to be monitored and controlled.

Prices of pulses have dropped significantly compared to their previous peak levels. The article attributes the control of food inflation to the combination of record production and effective government interventions.

As a result, prices of most food products have softened, providing some relief to consumers from the impact of inflation. In May, onion prices appeared to be easing, whereas potato and tomato prices saw a slight increase.

The average market price estimates were calculated based on prevailing prices from April 1 to May 19, 2025. The bulletin also noted that the opinions expressed in the article are those of the author and do not necessarily reflect the official views of the Reserve Bank.