A decision to procure potato in UP under the Market Intervention Scheme (MIS) has been approved by the Union Agriculture Ministry.
The MIS will be implemented by the state agency. Potato grown in the 2016-17 crop year (July-June) will be purchased at Rs 4,870/tonne, the ministry said in a statement.
"A maximum quantity of 1,00,000 metric tonne (MT) of potato may be procured under the scheme by the state agency," the statement said.
The Centre will provide additional Rs 1,217.50 per tonne or actual whichever is less for overhead expenses, such as transportation charges, mandi tax and godown charges.
Purchase centres/areas will be decided by the state government in consultation with the state agency.
Potato will be purchased from the cooperative societies, farmers' organisations or directly from growers to eliminate the possibility of middlemen taking advantage of the scheme.
The state government will ensure that the produce is purchased from genuine farmers only, it added.
The procured stocks, the ministry said, will be disposed off in the open market to ensure maximum realisable price. If necessary, this can also be sold to processing units within the state. The state agency would also make efforts to export the procured potatoes after processing.
In order to avoid recycling, the stock would not be sold in the same market rate from where it has been procured during the period of the scheme. However, if the prices are better it can also be sold, locally.
"Barter payments or payments in kind to farmers for procurement won't be allowed," it noted.
Payment to farmers as far as possible will be made through non-cash transaction and receipts for sales must be through banking channel only, preferably through Demand Draft.
Potato rates in Uttar Pradesh, the leading producer, have crashed in the wake of likely bumper crop. Wholesale rates have fallen below Rs 4 per kg now as against 10-12/kg in the year-ago period, as per trade data.
The country's total potato output is also expected to be bumper at 49 million tonnes in 2016-17 crop year.