The Hindu Business Line : Jatropha seed prices rally on entry of new players

Turning costly
Cultivators frightened over the rallying prices in recent months.
National Bio-Fuel Policy may bring in more clarity on issues concerned with tree-borne oil crops.
The cost of jatropha was Rs six ar kg till two years ago, but has now gone up to Rs 26 and more.

Coimbatore , Sept. 5

An all-round awareness on jatropha curcas as a promising "bio-diesel" plant may have raised hopes among those devoted to evolving alternatives to the fossil fuel. But, the same can't be said about the commercial jatropha cultivators and jatropha oil producers who are crestfallen on soaring seed prices.

The jatropha cultivators, also running extraction units, are particularly frightened over the rallying jatropha seed prices in recent months.

They blame the entry of new "cool" operators who, according to sources in the jatropha seed processing industry, are offering higher prices for jatropha seeds to be used for raising seedlings, forcing prices to spiral.

"The sudden entry of so many players at national and regional level offering to supply jatropha seed materials has driven the market crazy in as much as some people even try to pass off uncertified seeds as `hybrids' at higher prices," said Mr V.N. Selvaraju, Managing Director of the Coimbatore-based Renu Lakshmi Agro Industries (India) Ltd (RAIL).

What hitherto remained a "fence" crop in villages, jatropha's status has elevated in recent times with its cultivation gaining momentum, in the wake of the national campaign on bio-fuels.

The cost of jatropha procured from tribal hamlets/villages at around Rs six a kg till two years ago has now gone up to Rs 26 and beyond, depending on demand and supply. "But, there has been instances of late of collectors of the seeds and their agents offering as high a price as Rs 80 a kg for the seeds," Mr Selvaraju added.

Swelling demand

The surge in demand, according to him, is caused partly by "across the board" interests shown by different State Governments and their social forestry/forestry departments on developing jatropha plantations. The scope for export of seeds apart, the difficulty in timely availability of seeds too has created strains on supplies.

"The non-prescription of standards for the jatropha seeds/seedlings has come in handy for the new entrants to take advantage of the situation," Mr Selvaraju said. He feels the proposed National Bio-Fuel Policy should bring in more clarity on issues concerned with tree-borne oil crops.

Issues include quality planting material, special farm credit programme akin to those available for other agri crops and higher subsidy in setting up drip irrigation for jatropha plantations.

Shifting trends

A strong need is also felt to extend crop loan at 4per cent for jatropha growers by the banks, which will sustain development of this bio-fuel crop, Mr Selvaraju said.

Mr Selvaraju and his team in RAIL, starting off with commercial-scale cultivation of `safed musali', the herbal plants (tubers) used as an ingredients in herbal medicine for rejuvenation, migrated to promoting commercial jatropha farming in 2002 by entering into long term buyback arrangement with jatropha growers within Tamil Nadu and far off states like Madhya Pradesh, Rajasthan and Gujarat.

He set up a jatropha oil extraction plant in 2004 to produce the bio fuel. The 5.5 tonnes per day expeller unit recently relocated at Keeranatham near Coimbatore supplies bio-fuel oil to the Southern Railway. Mr Selvaraju has also planned to set up a 10-tonne per day capacity plant at Chittoor in Andhra Pradesh to produce bio fuel and glycerine.

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