High input cost to keep potato prices firm in West Bengal

With the new potato crop expected to be in market over the next two weeks, a sharp rise in input cost is likely to keep the prices firm.

Prices of potato seeds in West Bengal, which accounts for 30 per cent of the country’s potato production, have gone up by almost 50 per cent over the last year. The state imports more than 70 per cent of its total seed requirement from Punjab. In addition, the sharp rise in fertiliser prices has added to the cost of production. The cost of a 50-kg urea bag has gone up from Rs 700-800 last year, to Rs 1,300-1,400 this year, according to potato traders.

As a result, the cost of farming of potato this year has been about Rs 400 per quintal, against Rs 260-270 per quintal last year. At present, the wholesale price of potato is Rs 1,000 per quintal, and Rs 13-14 per kg at the retail level, almost 50 per cent higher than the corresponding period last year.

The prices might temporarily ease at the arrival of new crop to Rs 10 per kg, but owing to high input costs, will rebound and lower levels will not sustain, say potato traders.

On August 1, the Forward Markets Commision ( FMC) had suspended futures trading in potatoes from West Bengal to control volatility in prices. Last year, in Uttar Pradesh, too, which produces around 14 million tonnes of potatoes a year, the production was down around 20 per cent.

As a result, potato prices in West Bengal had surged from around Rs 700 per quintal in March to about Rs 1,000 per quintal by August this year.

“This year, too, the potato production could be similar to last year, though the final output will depend on weather conditions over the next few days,” said Dilip Kumar Parihar, secretary, West Bengal Potato Merchants’ Association.

Last year, instead of getting good prices due to lower supply, farmers suffered continuous losses.

“At this point in time the climatic conditions are good for potato. While there is no impact on the acreage, the productivity is yet to be ascertained. The crop might be same as last year,"said said Patit Paban De of the West Bengal Cold Storage Association.

The domestic consumption of potatoes in the state is three to four million tonnes, about half of last year’s production. The rest is exported to Bihar, Jharkhand, Odisha, Assam and parts of Andhra Pradesh.