BURNING the crop and taking out protest rallies in the Kasur, Pakpattan and Sahiwal districts of Punjab’s potato zone reveal the growing unrest among potato growers. Currently the market rates for potatoes are much lower than their cost of production.
To the concern of the nascent PTI-government, farmers seeking a support price mechanism for their produce as a protection against negative market forces launched a province-wide protest drive from Jan 15 by staging a sit-in outside the Punjab Assembly.
The provincial government reacted swiftly and managed to end the protest at least for the time being. It arranged a meeting of the protestors’ leaders with federal authorities this Wednesday (Jan 23) with the promise that an all-out effort would be made to resolve all issues related to exporting potatoes.
Punjab, particularly the 12-district-belt that runs from Kasur up to Khanewal district in the south, is the hub of potato production for it gives over 95 per cent of the national produce. Potato is a major staple food and has a significant contribution to the national domestic consumption and food needs.
Despite all odds, growers have reaped a bumper crop. But the commodity has not been fetching a reasonable price from the market, creating a potentially disastrous situation
Despite all odds, growers have reaped a bumper crop as potato acreage has been increasing on a year on year basis. But the commodity has not been fetching a reasonable price from the market. In Okara Mandi, the major potato market in the region, a bag of around 120kg was being sold for around Rs650-725 last week — much lower than its production cost.
Safeer Hayat, a potato trader from Okara, claims that he stored a large quantity of the crop last year in the hope of getting a good price during the off-season. But he could only get Rs1,000 per bag against his total purchase, plus storage cost, of Rs2,200 per bag.
Mr Hayat fears the bumper crop this year will result in a glut in the market and may further lower prices.
Potato Growers Society Vice President Chaudhry Maqsood Ahmad Jatt claims that the total cost of a bag of potatoes, from sowing up till it’s transportation to the market, stands at over Rs2,000. Hence, growers are losing at least Rs1,300 per bag at the current rates.
Providing a breakup of the cost, he explains that at least 13 bags of potato seed are used per acre for sowing and each bag of quality imported seed costs Rs9,000. A sum of Rs60,000-70,000 per acre is spent on fertilisers, pesticides, labour and paying rent for land.
Whereas after harvesting, growers have to pay Rs100 per jute sack, Rs100 per bag for transportation, Rs10 as loading and unloading charges and Rs20 commission to the arhti (commission agent).
The difference between the cost of production and yield price is so high that it has left growers unable to sow the next crop — maize — he says.
Mr Jatt, who is also the chairman of the Potato Research and Development Board Punjab, recommends that the government take at least two steps to improve the lot of potato growers and save them from financial losses.
Firstly, it should immediately arrange and promote export through land routes to neighbouring Iran and Afghanistan up to the Central Asian States.
Then, it should announce a subsidy, like in India, for potato exporters with the condition that they will pay the growers prime rate for the produce.
Lahore Chamber of Commerce and Industry President Almas Haider seconds Mr Jatt’s suggestion and urges the government to immediately provide relief to potato exporters for disposing off the surplus 1.6 million tonne potato crop in foreign markets to save the domestic market from crashing.
He argues that as the Pakistani potato is in great demand in Russia, Malaysia, Sri Lanka and the Middle East, its export to these and other destinations may not only save farmers but also help earn precious foreign exchange.
The government, however, is so far oblivious to the plight of the growers. “The rulers are not even listening to our problems let alone trying to solve them,” grumbles a farmer leader who has been abortively trying to get an appointment with Punjab Governor Muhammad Sarwar for more than a month.
“The government is offering subsidies worth billions of rupees to sugar millers but ignoring potato growers despite repeated demands,” says Pakistan Kisan Ittehad Punjab President Rizwan Iqbal.
In line with the rest, he adds that as a short-term measure the government should announce a subsidy for potato exporters and support price for the crop which will save farmers from starvation.
Published in Dawn, The Business and Finance Weekly, January 21st, 2019