Farmer caution slows seed demand

They are waiting for actual monsoon onset after slump in prices of produce

Farmers’ disquiet over lower commodity prices has led to a slowing in seed demand so far this kharif season, as wary growers await the first showers before booking their packets for sowing.

Last year saw uneven distribution of rain, resulting in drought in some parts of the west and south.

Seed companies expect a reversal in trend with the onset of rain.

Normally, companies supply seeds to their distributors before the actual monsoon rain. Farmers also ensure availability for sowing before the season’s onset, often booking seed packets in advance. 

“Seed demand is very weak this year; by now, it should have been pretty strong. The reason is surely low commodity prices and losses suffered by farmers during the period of demonetisation,” said Satish Kagliwal, managing director of Nath Seeds and founder-president of the National Seed Association of India.

With a sharp fall in recent weeks, prices of agricultural commodities are presently below their minimum support price (MSP). For example, maize, one of the major kharif sown crops, is quoted at Rs 1,300 a quintal in most wholesale markets, while its MSP is Rs 1,365 a qtl. Soybean is priced at Rs 2,693 a qtl, compared to its MSP at Rs 2,775 a qtl. “The price fall is sufficient to discourage farmers from stepping ahead this kharif. Since the government has also restricted its MSP operations, farmers might be monitoring realisations before finalising the crop to sow,” said a senior seed industry official.

Normally, many farmers sow seeds ahead of the monsoon rain with their own irrigation facility, especially of paddy, onion and other such produce for replanting later, when seasonal rain intensifies. However, they fear another late arrival of the monsoon and possible crop damage. India Meteorological Department expects a normal monsoon this time, at 96 per cent of the long period average. It has arrived two days ahead of its normal schedule in Kerala.

“Kharif 2017 should be good for Indian agriculture, as the monsoon is projected to be normal. The sowing season is expected to be on time, with the monsoon already setting in Kerala. There are some positive shifts in acreages expected towards cotton and maize this season. There might be some reduction in acreages of soybean and pulses. Availability of seeds would be good, and overall, if the distribution of rainfall is good, we would see another good agriculture year in 2017,” said Raju Barwale, managing director, Maharashtra Hybrid Company.

M Ramasami, chairman of Rasi Seeds and chairman of the Federation of Seed Industry of India, says prices of individual commodities would determine seed demand. “Farmers fetched an overall very good price from cotton and millet this year. Hence, their acreage might increase. That of paddy would depend upon the MSP and its market price,” he said.