Agriculture: Minimum Support Price(MSP)

The Minimum Support Price (MSP) is the price at which the government purchases crops for the farmers, to insure farmers against any sharp fall in farm prices.
MSP is the guaranteed amount paid to farmers when the government buys their produce.
Under Minimum Support Price (MSP), the Commission for Agricultural Costs & Prices (CACP) recommends prices for specific crops and a fair and remunerative price for sugarcane.
The CACP is a department of the Ministry of Agriculture and Farmers Welfare.
Commission for Agricultural Costs & Prices (CACP) announces minimum support prices (MSPs) for the mandated crops. The list of crops is as follows-
- Kharif Crops – Paddy, Jowar, Bajra, Ragi, Maize, Tur, Moong, Urad, Groundnut, Sunflower Seed, Soybean, Sesamum, Niger Seed, Cotton
- Rabi Crops – Wheat, Barley, Gram, Masur, Rapeseed and Mustard, Safflower.
- Others – Copra, Jute

- ‘A2’: Covers all paid-out costs directly incurred by the farmer in cash and kind on seeds, fertilizers, pesticides, hired labour, leased-in land, fuel, irrigation, etc.
- ‘A2+FL’: Includes A2 plus an imputed value of unpaid family labour.
- ‘C2’: It is a more comprehensive cost that factors in rentals and interest for owned land and fixed capital assets, on top of A2+FL.