Potato prices surge 30%

Output down while demand and exports are on the rise

Low production and significant demand from the export market have sent up prices of potatoes. Wholesale market prices are up 28-30 per cent compared to this time last year and could rise more.

Total export was 184,000 tonnes between April 2013 and February 2014, compared to 164,000 tonnes in 2012-13. According to sources, 15-20 containers (each of 28 tonnes) are still shipped daily to West Asia, Pakistan, Mauritius and Malaysia, among other destinations.

And, output is down. “There was intermittent rain in major producing areas like Uttar Pradesh, Punjab, Haryana and Bihar during November to February, which affected the crop.. the overall estimate of production loss is 25-30 per cent. Cold storages in major producing areas are only 60-65 per cent filled,” said R P Gupta, Director, National Horticulture Research and Development Foundation. “Secondly, there has been significant demand from other countries. Pakistan, for instance, has removed the duty on potato to be imported from India and has allowed 200,000 tonnes of import. These are two main reasons behind the increase in prices of the crop.”

Exporters add that in the past two months, prices have risen 20-25 per cent in the international market, making exports viable. “Pakistan and Bangladesh had a poor crop in the last rabi season due to adverse weather conditions and crop disease. Beside India, these two countries are the major exporters to the Middle East and other Gulf countries. Since production was hit in these two countries, the opportunity was with Indian exporters; demand picked up and the prices,’ said Sachid Madan, director, Technico Agri Sciences. The company is engaged in production of high-yielding and early-generation seed potatoes for India and neighbouring export markets. Currently, the price for exporters is Rs 15-18 a kg (FOB value, length 50 mm); it was Rs 11-12 a kg in February-March. Compared to last year, they say, prices are 25-30 per cent more.

According to government data, India produced 45.3 million tonnes of potato from an area of 190,000 hectares in 2012-13. It is sown in both kharif and rabi seasons. The kharif produce accounts for five per cent of total annual output, available between August and October. The remaining 95 per cent comes into the market between mid-December and mid-April, termed rabi produce. The rabi potato is stored till November and made available steadily for domestic and export markets.

Traders say the demand for potato would rise further in the coming days due to its substitution for other costly vegetables, due to high temperatures in several parts of the country.