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Mamata Banerjee’s no fare hike policy may lead to a crash in potato prices in West Bengal.
While potato production is estimated to be up by 12 per cent this season, nearly two-fifth of the 400-plus cold storages in the State have decided to keep their doors shut, without a hike in rentals.
The State had last raise the rentals for storage three years ago. This is despite a sharp 50 per cent rise in storage costs, especially for energy, during the period.
According to Ram Pada Pal, President, West Bengal Cold Storage Association, cold storages spend nearly Rs 150 for storing one quintal of potatoes during the storage season extending between mid-February to end-November.
The rental for storing potatoes is currently Rs 101 a quintal during the season.
West Bengal and Tripura are the only two States in the country where potato cold storage rents are controlled by the State Government.
Electricity tariffs have moved up by 50 per cent from Rs 30 a quintal about three years back to Rs 45 at present, while diesel prices have increased by 48 per cent from Rs 35 to Rs 52.
Labour costs have also gone up during this period, thereby, exerting pressure on profitability.
As many as 100 cold storages in the State are running at a cash loss and are unable to carry on operations this year, Pal said.
“The State Government had set up a committee to look into the issue. They have ensured they will look into the matter. We hope that the other storage units will soon commence operations,” he said.
supply glut
West Bengal, the second largest potato producing State, is likely to produce 12 per cent more potatoes at nearly 95-98 lakh tonnes this year.
While higher production across the key producing States including West Bengal, Uttar Pradesh and Punjab, is likely to keep the demand subdued; delayed and poor loading into cold storages might lead to a supply glut exerting pressure on prices, said Patit Paban De, Member, West Bengal Cold Storage Association.
Harvesting, which begins around end December, gains steam by early February and is complete by March 15.
However, harvesting has been slightly delayed this year on account of late sowing following poor rains.
“This means that a majority of the crop will come into the market by the second week of March thereby creating a supply glut,” said a potato trader in Singur-Ratanpur area.
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