Can Indian growers ride the TOP (Tomato, Onion and Potato) wave ?

Growing the same variety (table potatoes)

According to an article published by the Indian Express, the reasons for the drop in market prices are manifold. Even though UP has the largest number of cold storages in the country, last year’s stock is still available, which makes it difficult to create more storage space for the harvest this year.

Farmers also have increased the production of  new varieties of table potatoes that have a shorter growing period but also shorter shelf life.  Many farmers of Madhya Pradesh and Rajasthan (the adjoining states of Uttar Pradesh) have also shifted to growing the same potato varieties, whereas earlier they used to grow garlic. The farmers interviewed for the Indian Express article mentioned that the retail companies like Mother Dairy and Reliance have also not approached them to buy potatoes. Usually, these retailers buy the produce for their stock. Farmers in Punjab, the other potato growing state mostly known for growing seed potatoes that are supplied across the country, are earning less than half of last year’s price.

In Gujarat, the state that houses the largest number of potato processing companies of India, farmers have approached the Government to discuss how the Government can support growing of processing varieties. Farmers in Gujarat are taking a learning  from this year and are planning to shift to cultivating processing varieties. 

Mr. Gaur says that it is easy to export potatoes to other countries only when varieties are grown that are internationally known, and the Dutch companies have the largest number of varieties that are internationally known. So if the Indian Government allows and promotes growing varieties that are internationally accepted it will help to open markets in more countries and Indian farmers are always open to grow new varieties.

In a book published on Agricultural Value Chains in India (Page 38), the authors have mentioned that India’s share is only 2% in export of value added products like potato flour, meal, powder, flakes, granules and pellets. India is a net importer of potato starch.  On this Mr. Gaur mentioned that for making the above products, India needs a bigger volume of potatoes to be processed but also companies who want to manufacture value added products need to have equipment that can handle such volumes efficiently. For this Mr. Gaur thinks that the Dutch companies supplying equipment will be the right partners for Indian processors. Mr. Mohd Faruk, Sales Head, Allround and Ms. Bhavana Vishwanath, CEO, Kiremko India, a subsidiary of Kiremko B.V. echo Mr. Gaur: Indian potato growers should be encouraged or incentivised to grow processing varieties. But Ms. Vishwanath further suggests that Indian companies or farmer producer organisations who want to set-up potato processing plants should be able to avail interest subvention schemes that will help them in purchasing the right equipment and inspire them to invest.

However, when it comes to onion there are no short-term solution that will be possible through international co-operation. Onion storage is still a concern, as there is little involvement of the private sector in setting up storage facilities.  Hence, the Indian government has requested NAFED (National Agricultural Cooperative Marketing Federation of India Ltd.), a Government backed organization, to buy onions at a price above the prevailing market rate to create a buffer stock.  The Agriculture Ministry of India has set-up a price stabilization fund scheme to enable organisations like NAFED to intervene in the market to create buffer stock when there is a glut in the market.