Today, Wednesday, the Federal Cabinet approved an increase in the minimum support prices for 14 autumn crops for the 2026-2027 marketing season, by paying an amount of… $2.60 lakh crores to farmers. The decision was taken based on the recommendations of the Commission on Agricultural Costs and Prices (CACP).
According to an official statement, the increase in minimum support for kharif crops is in line with the Union Budget 2018-19 announcement of fixing minimum support at least 1.5 times the all-India weighted average cost of production.
According to the government, the estimated margin on production cost is highest for moong at 61%, followed by bajra and maize at 56% each, and tur/arhar at 54%. As for the rest of the crops, the margin is estimated at 50%.
“A major decision was taken in 2019 to ensure that farmers get a fair return for their labour. The Prime Minister has decided that the minimum cost of production will be fixed at least 50% above the cost of production,” Union Minister Ashwini Vaishnao said while briefing the media on the Cabinet decisions. “The CACP estimates the cost of the crop correctly by taking into consideration multiple factors like inflation.”
Prime Minister Narendra Modi praised the decision.
In a series of posts on X, Modi said that in order to protect the interests of farmer brothers and sisters across the country and increase their income, the NDA government is constantly taking important decisions.
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“In this direction, our government has approved an increase in the Minimum Support Price (MSP) for kharif crops for the 2026-27 marketing season. This decision will ensure that millions of food providers in the country get fair and profitable prices for their produce, while bringing more prosperity to their lives.”
As per the Cabinet presentation, the government expects annual procurement of 824.41 lakh metric tons (LMT) under the MSP regime.
The minimum exchange rate for common rice was set at $2,441 per quintal, while first grade rice will be purchased at $2,461 per quintal. Among the pulses, tur (arhar) MSP is set to $8,450 per quintal $8,780 and Awrad in $8200. For oilseeds, the minimum support price for groundnuts has been fixed at $7.517 per quintal of sunflower seed $8343, soybeans in $5,708 and sesame in $10,346 per quintal.
The government said it has been encouraging cultivation of pulses, oilseeds and food grains or shree anna in recent years by offering MSP for these crops. He also highlighted a rise in purchases and MSP payments over the past decade.
Rice purchases during the period 2014-15 to 2025-26 amounted to 8,418 LMT, compared to 4,590 LMT during the period 2004-05 to 2013-14. Procurement of all 14 kharif crops increased from 4,679 LMT in 2004-05 to 2013-14 to 8,746 LMT during 2014-15 to 2025-26.
