Mamata likely to offer relief as low wholesale price hits potato farmers

Kolkata: With the fall in

potato prices

continuing unabated, chief minister Mamata Banerjee is expected to announce a minimum support price on Tuesday for at least 10% of total production so that farmers stop distress-selling. Strangely, the slide in the wholesale price failed to have any impact on retail market. The retail price rose gradually from Rs 6 to Rs 10 in some markets till Monday.

Demonetisation, bumper production in states like UP and Punjab and bumper crop in Bengal collectively have left Bengal’s farmers in a tight spot. The shortage of cash and excess supply have hit demand, resulting in a dip in prices. Farmers stare at a huge loss as most of them have taken loans from mahajans at a high interest rate keeping in mind the profits made in 2015-16. “There was low yield in 2015-16. The retail prices rose up to Rs 24 per kg in city markets,” said Gour Das of Purshura, a

potato

farmer, who took loan at a high interest rate and now finds it difficult to recover production cost.

It’s a mystery how the wholesale potato price and the retail price become inversely proportional. While the potato wholesale prices plunge, retail prices rise. Potato traders blamed the 6-tier middlemen system working between the wholesalers and retailers and higher margin of profit by a retailer as reasons for the price mismatch. On Monday, the wholesale price in Hooghly, Burdwan and Bankura — three major potato-producing districts — ranged between Rs 2.5 and Rs 3. Farmers fear that if the trend continues, the prices may plunge to as low as Rs 1 per kg.

There is severe shortage of cash flow in the potato market. Besides, several big businessmen, a sizeable number of teachers, government employees and professionals invest in potato. “They buy from the farmers and put the same in the cold storage, expecting a good price at the end of the season. However, demonetisation and this year’s bumper production desisted them from investing in this sector,” said Arup Dutta, an agro-economist.

“While the total potato yield in 2015-16 in Bengal was 90 lakh tonnes, this year it has shot up to 1.15 crore tonnes,” said potato merchant Biswarup De. He said that last year both the potato merchants and cold storage owners sustained heavy loss due to demonetisation as most of the transaction in the business is done in cash.

Agriculture minister Purnendu Bose said, “We observe March 14 as Krishi Diwas. The CM will address the issues and will definitely find a way out.”