Farmers prefer chilli over cotton, tobacco

Farmers in southern India may prefer to hedge their risk arising out of unseasonal or extended monsoon by increasing chilli acreage in the coming kharif season.

Chilli prices have almost doubled in a year. An official from the Spices Board confirmed that the acreage under chilli may increase 10-15 per cent when sowing for the kharif begins.

While of late cotton has been preferred in the south, with more and more farmers opting for it, last kharif season’s late rain highlighted the risk of sowing crops like cotton and tobacco. Chilli emerged as a better crop, giving good returns.

Cotton was preferred because of the better yield with use of Bt seeds. But chilli would be preferred over cotton and tobacco as it can be grown in a nursery initially and later transplanted to the farm, while cotton and tobacco have to be grown directly. This makes cotton and tobacco riskier compared to chilli.

This year, production of chilli has fallen not due to lower acreage but due to lower transplantation, as plants were kept in the nursery due to heavy rain which continued till December.
 

CHILLI STATISTICS
Year	Area	Production	Yield
2005-06	172,000	538,000	3,136
2006-07	214,000	766,000	3,579
2007-08	223,000	772,000	3,463
2008-09	203,000	773,000	3,803
2009-10	207,000	831,000	4,023
Note: Area in hectare, production in tonnes and yield in kg/hectare

The cotton crop saw more destruction, as it was exposed to heavy rain, causing a steep rise in its prices. Cotton prices in the spot market rose 82 per cent in the last one year. Traders expect a 20-30 per cent drop in chilli output this year compared to last year, as transplantation was lower. This year, the output is expected to be around 7-8 million bags (1 bag = 40 kg) compared to 12.5 million bags last year. Chilli has given return of Rs 80 a kg, compared to Rs 45 a kg last year.

In the last five years, yield per acre has gone up by 29 per cent from 3,136 kg per hectare to 4,203 per hectare. Demand for the spice is also strong and export demand is providing a cushion to prices at higher levels. This year, India exported 218,500 tonnes of chilli during April-February compared to 180,750 tonnes last year, a rise of 21 per cent.