Agri Business

Potato prices in Bengal drops by 50% on excess production

Shobha Roy Kolkata | Updated on August 03, 2021

Potato production in Bengal is estimated to be higher by nearly 16 per cent at 110 lakh tonnes this year, as compared to 95 lakh tonnes in 2020

Potato prices in West Bengal have dropped by nearly 50 per cent in less than two months on the back of excess production in key producing regions including Uttar Pradesh, Bengal and Gujarat. Wholesale price of the tuber (Jyoti variety) is currently hovering around ₹500-550 a quintal, as compared with ₹1,000-1,100 a quintal in early June this year.

On a year-on-year basis, prices have dropped by nearly 62 per cent from ₹1,300-1,400 a quintal in the same period last year.

According to Patit Paban De, former president of West Bengal Cold Storage Association, the prices are far below the cost of production and other expenses including storage costs entailed by a farmer.

The average cost of production and expenses incurred (at the farmer's end) is close to ₹700 a quintal. This has made them wary and most have been holding back stocks waiting for prices to improve.

“As at July end the release of potatoes from cold storage is only around 30 per cent while it should have been close to 33-34 per cent. Potato production is higher in most States this year and so there is excess stock in the market. Farmers are holding on to their stock as the prices are lower than their cost of production,” De told BusinessLine.

Bumper production

Potato production in West Bengal is estimated to be higher by nearly 16 per cent at 110 lakh tonnes this year, as compared to 95 lakh tonnes in 2020. Around 71 lakh tonne of potatoes were kept in cold storages this year, as against only 55 lakh tonne in 2020. There are around 400 cold storages in Bengal and the total storage capacity is estimated to be close to 70 lakh tonne.

Nearly 38 per cent of potatoes were released from cold storages this time last year backed by a steady demand. However, release of the stock has been impacted by poor demand this year, said Rabindranath Pal, a potato trader from Hooghly district.

Cultivation of potato in Bengal is spread over close to 4.6 lakh hectares. Hooghly, Burdwan, Bankura, East Midnapore and West Midnapore are key growing districts. There has been around 5-7 per cent increase in area under cultivation this year.

Farmers, who got a very good price for their crop due to lower production and the steady demand last year, were encouraged to go for higher cultivation of the crop this year. Moreover, the favourable climatic condition in the form of a long winter has helped increase productivity and yield.

The excess production of potatoes is likely to drag down prices further this year pushing farmers and traders into a huge loss, sources said.

Published on August 03, 2021

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