India: Experts link potato price crash to stock clearance from cold storages

Blaming demonetisation for the steep fall in potato prices, Congress leaders staged a demonstration at the Indore collectorate on Friday.

Prices of potatoes, which were being sold for ₹400-500 per sack (₹8-10 per kg) in the wholesale mandis earlier this month, have dropped to ₹1-3 per kg.

“The old stock is being released from cold storages and there are expectations of a bumper crop this season,” deputy director (horticulture) PS Kanel told HT on Saturday. The new potato crop starts arriving in January in the mandis.

Experts HT spoke to were of similar views. “The fall in potato prices is more due to seasonal reasons. The production is expected to be more while the impact of demonetisation is limited,” said agriculture expert Sachin Bondriya. The potato yield this year is expected to be about 250-300 quintal per acre, about 25% more than last year due to favourable conditions.

Manohar Umrao Singh, a farmer who grows potatoes on the outskirts of Indore, said he was watching the prices closely. “My crop will be ready in about a month’s time. However, old potatoes from cold storages have flooded the market and led to price crash.”

Madhya Pradesh has 210 cold storages, of which 65 are in Indore district.

Farmers in Malwa region have been encouraged to grow more potatoes as they are increasingly finding a ready market in food-processing industries and export market in the Gulf. Potatoes grown in Malwa are preferred for exports because of its high quality and taste. While top-quality potatoes are exported, the remaining are sold in local markets.

According to data from the agriculture department, farmers have sown vegetables, including potato and garlic, on 30,000 hectares in the region this rabi season, an increase of more than 30% over last year.