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Potato prices soar amid drop in production, increase in demand

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KOLKATA: Potato prices have surged more than 62 per cent since May as production fell in key growing states and demand soared amid the Covid-19 pandemic.

Traders in Uttar Pradesh, the largest potato producer in the country, said prices will remain firm at least till March next year.

Demand for potato, a staple for Indian kitchens, has been rising during the pandemic as the tuber can be stored longer than other vegetables.

In West Bengal, the second largest producer, prices have shot up to Rs 26-28 per kg in the wholesale market from Rs 16-18 in May. Retail prices are ruling at Rs 32-35 a kg in the state. Price is following the same trend in Uttar Pradesh as well.

“This year, the crop is down by 20 per cent than last year. So, there is a shortage in supply,” Arvind Agarwal, president of Cold Storage Association of Uttar Pradesh, told ET. “The demand has gone up across all the states due to lockdown.”

Uttar Pradesh has produced around 12.4 million tonnes of potato this year as against 15.5 million tonnes in 2019.

Agarwal said the rise in prices has brought some cheer to farmers. “Farmers of Uttar Pradesh had suffered for four consecutive years as they had to sell potatoes below their cost of production. They are at least recovering some of their losses,” he said.

According to Agarwal, prices will remain firm till next March. “The sowing for the new season crop will be delayed by 15 days. Generally, sowing begins by end of October. But this year, sowing is expected to begin by mid-November,” he said.

Traders said implementation of the Farming Produce Trade and Commerce (Promotion and Facilitation) Ordinance has also pushed up the prices of the vegetable. The ordinance, which seeks to ensure a barrier-free trade in agriculture produce, came in force in June.

Farmers in Uttar Pradesh said seed prices have gone up by one-and-a-half times since last year, which will have an impact on the production in the upcoming sowing season as their cost of sowing will go up. “Since buying seeds is becoming difficult for us, the acreage is expected to come down. Production may also come down,” said Raman Singh, a potato farmer in Agra.

Crop size in West Bengal too has come down to 8.5- 9 million tonnes this year from 11 million tonnes last year.

“We have a cold storage capacity for 71 lakh tonnes. But this year, we have only loaded 56 lakh tonnes,” said Patit Paban De, member of West Bengal Cold Storage Association. “Of this, 30 lakh tonnes have already been sold and we are left with 26 lakh tonnes. The new crop will come in December-January. Till then we have to manage with the existing stock. Therefore, prices will not fall immediately.”

West Bengal is flooded with orders from Odisha, Andhra Pradesh, Bihar, Jharkhand, Chhattisgarh and northeastern states. Though the state chief minister Mamata Banerjee has directed potato traders to ensure that the retail price of the tuber is brought down to Rs 25 a kg, traders said it is impossible in this barrier-free trade regime.

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