The Punjab State Cooperative Supply and Marketing Federation limited, popularly known as Markfed, is in the red now. One of Asia’s largest marketing cooperative federations, its losses are likely to touch Rs350 crore mark in the current fiscal year, that is 2015-16.
Markfed’s balance sheet for 2013-14 reveals that the organisation suffered a loss of Rs324 crore.
The sorry state of fiscal affairs is even coming in way of procurement by the organisation, which is one of its prime functions.
Markfed, marketing federation of over 3000 societies, has expressed inability to purchase sunflower seeds through its funds following the mounting losses. The federation has claimed that even arranging funds by borrowing would not be viable.
Elaborating, a senior Markfed official informed The Pioneer that borrowing was likely to create “unnecessary hassles and avoidable burden of interest” on the same.
“Markfed has been running into losses since past couple of years...The losses are likely to cross Rs350 crore mark this year,” said the official, without divulging further the reasons for the same.
However, Markfed attributes huge damages to the wheat and paddy activity. As per 2013-14 accounts, it has suffered Rs190.24 crore loss from wheat and Rs85.75 crore to paddy.
Faced with the situation, Markfed has called for creation of corpus fund by National Agricultural Cooperative Marketing Federation of India (NAFED) for making timely payments directly to the farmers for ensuring smooth functioning of the price support scheme.
The official added that the arrangement of space, required for storage of sunflower crop, has to be made by the Punjab State Warehousing Corporation.
Markfed can pursue the matter with the Warehousing Corporation after NAFED makes clear the intended duration for storing sunflower seeds in the warehouses, he added.
The development is significant as the state government has fixed June 1 to July 31 as the procurement period for sunflower seeds, and has requested NAFED to procure the seeds in Punjab keeping with the minimum support price declared by the Central Government.
NAFED, on the other hand, is claiming that it was willing to make the purchases, but the guidelines made it mandatory for it to enter into an agreement with the state government to enable purchases by Markfed.
The minimum support price (MSP) for sunflower seed for the market season 2015-16 has been fixed at Rs3,800, just Rs50 up from the previous year’s MSP of Rs3,750 per quintal for market season 2014-15.
Notably, the potato crop in the state had largely been damaged, compelling the farmers to go in for sunflower cultivation and calling for the need to put in place a system for its procurement.