How is the TN government addressing Rs 143 crore in farmer dues after NCCF payment delays?

Chennai, June 24 (NationPress) In a significant move to support thousands of farmers impacted by the delayed payments, the Tamil Nadu government has intervened to release Rs 143 crore in outstanding dues due to procurement issues caused by the National Cooperative Consumers’ Federation (NCCF), a central agency operating under the Union Department of Consumer Affairs.

The NCCF had suspended paddy procurement in eight non-delta districts—Tiruvannamalai, Kancheepuram, Tirunelveli, Ramanathapuram, Vellore, Ranipet, Villupuram, and Thiruvallur—during peak harvesting, leading to protests from farmers who had not received their payments.

In reaction, the state has instructed the Tamil Nadu Civil Supplies Corporation (TNCSC) to promptly settle the dues for about 5,000 affected farmers within the next 7 to 10 days. This amount will subsequently be reclaimed from the NCCF, as confirmed by officials.

This decision was prompted by a formal request from the Union Government, urging Tamil Nadu to take action and resolve the crisis stemming from the NCCF’s operational shortcomings.

Previously, the NCCF was authorized to procure paddy from the eight districts at the Minimum Support Price (MSP) and convert it into rice for delivery to TNCSC.

Upon receiving the rice, TNCSC was expected to compensate the NCCF. However, officials disclosed that although the NCCF procured around 3.6 lakh metric tonnes (MT) of paddy from nearly 24,000 farmers—valued at Rs 810 crore—it succeeded in processing and delivering less than 40 percent of the stock.

This disruption in the conversion process resulted in a cascading delay in the payment cycle.

A significant portion of the procured paddy reportedly remained stored in open Direct Procurement Centres (DPCs), leading to excessive moisture accumulation and spoilage during rains. The deterioration in stock quality further complicated processing and payment procedures, ultimately causing the NCCF to halt procurement operations in the eight districts.

In light of these ongoing challenges, TNCSC has opted to take direct charge of paddy procurement operations in the affected districts, effectively ending the NCCF’s involvement in the process.

Officials from the Tamil Nadu agriculture department stated that TNCSC and NCCF have collectively disbursed Rs 9,396 crore to 4.71 lakh farmers, and the remaining Rs 143 crore will be paid within 10 days.

Despite these hurdles, paddy procurement figures in Tamil Nadu have exhibited a remarkable year-on-year increase.

During the current Kharif Marketing Season (2025-26), over 39 lakh MT of paddy has been procured, compared to 29 lakh MT during the same timeframe last year.

Officials anticipate that this year’s total procurement will surpass last year’s by 8 to 9 lakh MT.

The swift action by the state government is expected to restore confidence among farmers and ensure smoother procurement operations in the forthcoming months.