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Seed producers protest as ministry cuts Bt cottonseed price, trait fees

IANS  |  New Delhi 

The Ministry in a late night notification cut the government-controlled price of BG-II genetically modified cottonseed by Rs 60 to Rs 740 per pack of 450 grams, leading to protests from producers.

It has also cut cut the "trait fees" for the GM produce by another Rs 10 to Rs 39 per pack. Trait fees are paid to the patent holders on GM products.

"It is a shock to us," said M. Ramasami, of and of the Federation of of (FSII), reacting to a notification of the ministry.

will take a hit of Rs 50 per pack, because the government had also reduced the fee payable to the technology licensor, Biotech (MMB) for the genetically-modified insecticidal trait.

Trait fees "were less than 1.5 percent of the cost of cultivation for farmers. It is unfortunate that today's order further erodes trait fees, which are now less than 0.5 percent of the cost of cultivation, while the technology continues to provide value to farmers," Arun Gopalakrishnan, a for said.

Cottonseed was brought under price control nationally in December 2015. Till then prices were fixed by states. In March 2016, the ministry notified Rs 800 as the price of BG-II cottonseed, which was Rs 30 lower than its controlled price in Maharashra. (Telangana, Andhra Pradesh, Gujarat, and had pegged it at Rs 930, while and had kept it Rs 1,000).

had gained then, because trait fees had been cut by 70 percent from Rs 163 to Rs 49, while the had been reduced by 4 percent.

The newly-notified prices do not even account for inflation over the past two years, Ashwani Yadav, of FSII said. The association had asked the price to be revised to Rs 875. The (NSAI) from whom FSII had broken away in August 2016, had sought a price of Rs 945.

An official, who asked not to be named, said seed companies by their own admission were paying Rs 330 per pack to farmers producing the seed. The balance of Rs 371, minus the trait fee of Rs 39 would leave them enough profit margin after accounting for distributor and margins, marketing and packing costs, financing charges and overheads. Many of the seed companies claim R&D costs without actually undertaking any research, he said.

While admitting this was true of most seed companies, Ramasami said the bigger players in the acutely-competitive cottonseed market owe their position to the research they undertake. Rasi Seeds, he said, employed 10 cottonseed breeders who were doing research on a 120-acre plot in Salem, The increase in India's production was mainly due to high-yielding varieties developed by Indian research-based seed companies.

MMB's trait had helped by protecting those yields from bollworm attack. One of the best-selling cottonseed hybrids, RCH-659 was brought to market in 2012 after more than 10 years of breeding activity. But it took three years of demonstration and education in good agronomic practices for it to catch the fancy of farmers. Continuous research is required for a hybrid to remain ahead of the competition, Ramasami said.

Not all cottonseed is sold at the But companies that maintain trait purity and germination quality above the government-notified standards, do not discount their prices by much.

Last year 40 million packets were sold. Assuming that they were all sold at highest permitted price (which is not the case), the industry would suffer a setback of Rs 200 cr. would take a hit of Rs 40 cr.

cottonseed prices were brought under price control for the first time in 2006. At that time it was retailing for Rs 1,800 a pack and the trait fee was Rs 1,200. Farmers complained and the and state governments intervened.

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(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Tue, March 13 2018. 15:10 IST