Kharif Outlook: Chilli seeds turn red hot as farmers look to expand area

The acreage under chilli is set to increase this kharif season as farmers in major producing States of Andhra Pradesh, Telangana and Karnataka are likely to bring more area under the spices crop. It has, in turn, triggered a huge demand for the hybrid seeds.

Seed companies such as Mahyco, Syngenta, and Seminis among others are witnessing a surge in demand for hybrid chilli seeds, and most preferred varieties include the Byadgi chilli and hybrids that are tolerant to leaf curl virus. Higher returns fetched by dry chillies last year is attracting more farmers to the cash crop this season, stakeholders said. Besides, the supply issues that cropped up due to the excess rains hurting chilli seed production in key regions last year have pushed up prices.

Considering the demand for seeds, chilli stakeholders including vendors and farmers estimate acreages to increase by 10-20 per cent this year.

“Chilli is commanding more acreage this year as farmers are very bullish. We had seen a similar trend in 2016. This year it is going to be a repeat of 2016 season,” said Sateesh Nukala, co-founder and CEO of BigHaat, an online farm input vending platform. Chilli acreages touched a high of 8.59 lakh hectares (lh) during 2016-17 when production of dry chillies peaked to 24.11 lakh tonnes.

Nukala said demand for seeds has gone up, while supply, at the same time, has declined because of the rains last year affecting seed production. “Farmers are facing difficulties and we are helping them by providing alternatives,” Nukala said.

While hybrids such as Syngenta’s HPH 5531, Mahyco’s Tejaswini and Yeshaswini, Nunhems’ Armour and Seminis are in high demand, BigHaat is making available seeds from companies such as Sarpan and Bioseed among others, he added.

“There is a great demand for hybrids such as Mahyco’s Yashaswini that is tolerant to leaf curl virus and it has been sold out,” Nukala added.

Madhavi Reddy, Principal Scientist at Indian Institute of Horticulture Research, which has developed five hybrids resistant to LCVs this year, said they are being evaluated for large scale cultivation. There’s a good amount of interest for chilli cultivation from farmers this year as prices were good last year and there could be some shift from cotton to chilli, she said.

Prices of red chilli varieties such as Byadgi, Teja and Sannam among others had witnessed an increase last year on lower output. Green chilli production for 2020-21, according to first advance estimates, is pegged at 40.65 lakh tonnes, lower than the previous year’s 41.19 lakh tonnes. Green chilli acreage for 2020-21 is estimated at 3.91 lh, up from previous year’s 3.87 lh.

The production of red or dried chillies was estimated at 19.14 lakh tonnes during 2020-21, lower than previous year’s 19.31 lakh tonnes. Andhra Pradesh is the largest producer of dry chillies, followed by Telangana, Madhya Pradesh and Karnataka.

“Due to the shortage of seeds, the prices across brands are up by a minimum of 20 per cent,” Nukala said. The minimum normal price, which used to be around ₹25,000 per kg last year has moved up to ₹40,000 this year and maximum prices range from ₹1-1.3 lakh and upwards in some cases, he said.

Farmers’ main concern is the cost of production. “A 10-gram seed packet costs ₹1,250 and we need 10 packets for an acre. The overall cost of production for the season goes up to ₹1 lakh,” P Ramesh, a small farmer from Warangal district, told BusinessLine .

The cost of production goes up to ₹1.5 lakh in some areas, depending on the availability of labour and water.

Farmers in Telangana, who grew chillies in about two lakh acres last year, also face the challenge of spurious seeds, which are being smuggled from Andhra Pradesh.

The demand for chilli seeds is such that early this week in Bellary, police had to intervene to control the farmer crowds at a centre, where Syngenta’s HPH 5531, a high yielding Byadgi chilli hybrid, was distributed to farmers. Syngenta sources said more farmers were taking up chilli cultivation this year after getting good returns last year and that the demand for seeds was higher than the supply.

While farmers still use the open pollinated varieties for Byadgi chillies, which are traditionally grown in the North Karnataka districts of Dharwad, Gadag and Haveri, the demand for hybrids is also on the rise in recent years. The Byadgi chilli, which has low pungency and higher ASTA (Amercian Spice Trade Association) colour value, is preferred by the processing industry.

Sources at Mahyo said the company was witnessing a good demand for chilli seeds this year. However, production of Mahyco’s hybrids such as Yashwini was limited this year. Mahyco’s Tejaswini has good demand from the export markets.

“Based on the seed sales and internal analysis, we expect acreage to increase by around 10 per cent,” Nukala said, adding that the spices crop would gain area at the cost of cotton and other crops. BigHaat expects to more than double its sales of chilli hybrids to over one tonnes this season, he said.

Besides shortage of seeds, farmers are also facing the problem of spurious seeds, said Yeshawant K C, general secretary of BJP Kisan Morcha in Guntur. “As the state seed corporations are unable to meet the requirement of farmers, they are forced to look at private players,” he said, adding that area could go up by about 20 per cent in Andhra Pradesh this year from 3.7 lakh acres last year. The Government should support the concept of seed villages, besides encouraging farmers to go for seed replacement, which would enhance the yields, he said.

With good demand for the produce last year, farmers in Telangana are expected to increase the acreage this kharif season. “We got a good price before the lockdown. the price went up to ₹21,000 a quintal. The price was encouraging last year too,” said Ramesh.

Farmers are also worried about the yields and the price. “We need to get at least 10 quintals (an acre) and a price not less than ₹10,000 a quintal. If it falls less than that, we will suffer losses,” Ramireddy, a farmer in Khammam, said.

The chilli seed market is estimated at over 150 tonnes per annum, of which the hybrid seed market is around 100 tonnes and the open pollinated variety is about 50 tonnes. The value of the chilli seed market is estimated to be around ₹400 crore.

(This is part of a series of Kharif Outlook reports that have been appearing in these columns since last week.)

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