Tuber troubles: Cold storage offers cold comfort

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Written by RITU SHARMA | Deesa | Updated: October 11, 2018 12:30:20 am

Tuber troubles: Cold storage offers cold comfort

Deesa town’s famous Potato Chowk. ‘Deesa: Gujarat’s Potato City’ reads this statue right at the entrance (Javed Raja)

After incurring heavy losses on his 1,200 sacks (each of 50 kg) of potato harvested in March 2017, Dineshbhai Mali sowed less area under the tuber in the following season early last-November. The 40-year-old’s crop this March was just 900 sacks, which he, like before, kept in a local cold store for selling at higher rates in the off-season. But the lower production has hardly helped. Out of the total 900 sacks, this farmer from Deesa in Banaskantha district of North Gujarat has managed to sell only 300 at a “reasonably profitable” average price of Rs 550 per sack (Rs 11/kg). And ahead of the next planting season — from end-October to mid-November around Diwali — he still has 600 sacks lying at the cold store.

“The price received now would barely cover my rentals for all these months. Rather than lifting and trying to sell, it is better I simply gift those sacks to the cold store owner,” remarks Mali, who claims that his household is running only on the sale of milk from his four cows and two buffaloes.
His isn’t an isolated story.

Farmers across Deesa — Gujarat’s “potato capital” — have been struggling with cultivating a crop whose prices haven’t really looked up since 2015, more so in the period after demonetisation. In 2013 and 2014, potato prices at the Deesa APMC (agriculture produce market committee) mandi averaged Rs 6.56 and Rs 8.55 per kg, respectively in March and they climbed to Rs 10.52-16.99 by July. Farmers could easily, then, recover both production costs and cold store rentals by not selling immediately after harvest. However, in 2017, prices ruled just over Rs 3/kg in March and remained at more or less there. This year, too, the rates haven’t gone up as much as expected from a smaller crop, while even softening after July (see table).

Indaji Mali, a farmer from Vadaval village in Deesa taluka, was until 2015 cultivating potato on 40 acres of land, including five acres of his own and the rest leased in from other owners. In 2015, he suffered losses on his produce of 10,000 sacks that went for as low as Rs 1 per kg. But the subsequent years have been worse, with Mali estimating his cumulative losses at Rs 40 lakh. He has since restricted potato plantings to 30 acres in 2016 and five acres (entirely his own land) last year. Despite that, he has been able to dispose of only a third of his 1,500-sacks crop this time; the remaining 1,000 are rotting at the cold store.

Naveen Mali, 35, belongs to a 20-member joint family, which has for the past three generations been into potato cultivation in their 300-acre combined holding. But the behaviour of market prices in recent years is something beyond even a farmer like him. “The basic production cost of the crop is Rs 5-6 per kg, and adding cold storage charges would take it to Rs 8-9. When prices do not even reach there, as has been so for most of the time since 2015, what are we supposed to do?,” he asks.

Bemjibhai Thakore has no such confusion. This 47-year-old farmer from Aseda village, who owns just three bigha (1.75 bigha=1 acre), has stopped growing the cash crop altogether. “I spent Rs 18,000 and couldn’t even realise Rs 10,000 from the sale of my potato on one bigha in 2016. Since then, I have stuck to jeera (cumin) and groundnut on two bigha, and switched to seasonal vegetables such as lady’s finger and brinjal on the remaining. At least, I’m not losing money now,” he points out.

Farmers discussing potato prices at the APMC in Deesa. Javed Raja

Farmers aren’t the only losers in potato. Gujarat has some 450 cold stores, of which 200-odd are in Banaskantha district, with half of them coming up during 2015-17. “From 2012 till 2014, there was a boom in potato prices that led to farmers expanding acreages and also to the creation of new cold store units. Many farmers themselves came together to start these and they all started operating after 2015 when prices crashed,” notes Ganpatbhai Kachhava, president of the Deesa Cold Storage Association.

Today, the store owners are also in the red, with farmers not lifting the stocks on which they cannot afford to pay rentals. But with prices being what they are, even the cold stores cannot profitably dispose of the “gifted” potatoes. The tubers that are small or are close to rotting due to the long period of storage are, in fact, being further “gifted” to animal shelters: Deesa town alone has three gaushalas and two larger panjrapoles, while numbering 97 and 15, respectively, for the district as a whole and housing about 60,000 animals.

“10 out of the 100 units here have already closed down and we expect another 15-20 to follow soon. Owners cannot bear the losses and are in no position to find buyers either, so that they can repay the bank loans taken,” says Kachhava. The cost of setting up a cold store with an average capacity of 7,500 tonnes is roughly Rs 6 crore, on which the Gujarat government provides a subsidy of Rs 2 crore. The operational cost for a full season is reckoned to be 10 per cent of the total capital outlay. The owner has to, in addition, pay interest on the borrowed funds.

Cold stores are currently being hit both by low potato prices as well as shrinking of cultivation area itself. “When farmers sow less, the crop available for storing reduces and our capacity utilisation suffers. Banaskantha district’s total cold storage capacity is 3.35 crore sacks, but only 2.5 crore sacks have got stored this year,” adds Kachhava.

The situation could worsen in the new season, with Banaskantha getting only a third of its average rainfall quota during this monsoon season. “The Banas River (a tributary of the Chambal) is a natural recharger for the entire district. With hardly any water in it and also the Dantiwada dam only 20-25 per cent full, our bore-wells will not be recharged. Farmers may find it difficult to grow potato even with drip and sprinkler irrigation,” states Naveen Mali.

The borewell in Dineshbhai Mali’s farm was dug 5-6 years back, when times were good. Today, neither are prices good and nor can he afford to invest Rs 7-8 lakh in a new bore-well for drawing water that has depleted to lower levels. Add to this state government apathy. “They had promised a subsidy of Rs 50 per sack and every farmer was supposed get it on up to 600 sacks. I have received only Rs 15,000 out of the eligible Rs 30,000 amount, while there are many who haven’t got even this,” he alleges.

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