India: Higher Potato Prices reported in Punjab, West-Bengal

Punjab

The Times of India reports a price increase at retail in West-Bengal of Rs 5 per kilogram compared to last year. Experts tracking the price movement of potatoes say the possibility of a slide in the rates seems thin. Instead, it is likely to stay high for at least the next five months because Bengal has optimal yield this year and it didn’t turn out to be a bumper crop that often pulls down the price.

A survey of the city markets — Gariahat market, Lake market and Maniktala market — on Wednesday shows the tuber prices vary between Rs 14 and Rs 16 a kg, depending on the variety, S1, Jyoti and Chandramukhi.

But farmers have made a killing this time, the best in the last eight years, with farm prices at Tarakeswar going Rs 8-9 a kg on Monday, at least 2.5 times more than the Rs 3.30-Rs 3.60 a kg rate last year. Accordingly, the wholesale prices stood at Rs 500 for a packet for 50 kg, which comes down to Rs 10 a kg.

The surge in potato prices has an economics and perhaps a dose of politics behind it. The untimely rain after the onset of winter took its toll on production, bringing the yield down to 100 lakh ton, 15 lakh ton less than 115 lakh ton last year. Moreover, 90% of the state’s aggregate storage capacity was full by Monday. Traders collected potato packets from farms early.

According to the agriculture department, the state consumes 5 lakh ton potato a month, the annual consumption being 60 lakh ton. Of the 100 lakh ton yield, about 63 lakh ton have already reached the 453 cold storages in the state, leaving about 20 lakh ton in farms. A chunk of these potatoes may go outside Bengal to UP and Punjab

The other part is political. With the panchayat polls being round the corner, chief minister Mamata Banerjee is keen to see farmers get a good price. She is keeping a tab on the potato prices and farm prices.

But a cold storage owner doesn’t see the surge in potato prices as a reflection of demand and supply.

A cold storage owner:

“Farm price for potato — Rs 500 for a 50kg packet — is arbitrary. It was fixed without going into the economics. The Trinamoolrun panchayats spread the rates ahead of the polls.”

“The farm price and consequent wholesale and retail prices need correction. The government committee doesn’t seem interested.”

Refuting the charge, Pradip Majumdar, agriculture adviser to CM, cited at least three factors behind the surge:

“The production is optimal this year. There is a slump in supply from Punjab and UP that added to the overproduction problem last year.”

“Traders took the initiative to buy potatoes they couldn’t in 2017 after demonetisation.”

Source: Times of India