Exports: After refusing to accept the low prices offered at the Food Corporation of Bhutan Limited (FCBL) auction yard in Phuentsholing for two days, some 20 farmers agreed yesterday to sell more than 500 metric tonnes (MT) of potatoes at negotiated rates.
About 11 Indian traders offered to lift the entire produce on December 14. However, the price they offered to pay yesterday was lower than what the farmers expected.
However, FCBL stepped in and made up the difference.
Traders paid Nu 520 for a sack of large red potatoes. But for the medium sized potatoes, they offered only Nu 310 a sack. After discussions with the farmers, FCBL decided to offer Nu 420 a sack.
A sack of potatoes, irrespective of quantity or size weighs between 50-60kgs.
While traders offered only Nu 60 for a sack of large sized white potatoes, FCBL decided to up the price to Nu 350. Similarly, for a sack of medium sized white potatoes, FCBL offered Nu 400, while the Indian traders only Nu 110.
Traders also offered only Nu 75 and Nu 40 for a sack of small-sized red and white potatoes respectively. FCBL upped the price to Nu 200 a sack.
The difference in prices will be borne by the government.
Farmers froze all transactions on December 13 when Indian traders offered not more than Nu 50 per sack. While the new negotiated prices yesterday did not please the farmers, they said it was still better than seeing their potatoes rot.
Sigay Dorji from Kazhi gewog in Wangdue said that people have worked hard in the fields this year to produce potatoes. “Some people rely mostly on potatoes,” he said.
He added that compared to the beginning of this year and past years, little profit would be made this year. Potato farmers did brisk business at the beginning of the season this year.
The average price of large potatoes reached Nu 26.51/kg in October this year. Around the same time last year, potatoes fetched Nu 18.06/kg. The highest average price recorded this year was Nu 50/kg. In 2014, a kilogramme of potatoes was being sold for Nu 54.
Wangchuk, 47, from Wangdue is not sure how much he will earn at the agreed prices. “The prices for the large- and medium-sized potatoes are okay but we may not be able to make up for the transportation costs on the small ones,” he said.
Wangchuk farms potatoes on 1.5 acres in Khotokha, Wangdue. He spent Nu 15,000 for transportation.
Another farmer, Dophu, said that he would still be facing a loss given the expenditure incurred on food, accomodation, and transportation.
He pointed out that the government could have worked out a better solution.
Due to the demonitisation process in India, availability of hard cash decreased drastically. Indian farmers who usually bought from the traders lacked cash to purchase the potatoes.
Cold storages in India also offered to distribute potato seeds free of cost to these farmers when there were no takers. Although some Bhutanese farmers had genuine reasons to do so, many chose to hoard their produce expecting better prices later, FCBL officials said.
But arrival of cheap Indian potatoes changed the market scenario. Indian traders who buy at the auction yard were also not able to sell.
Potato production also increased this year with approximately 2,000MT of extra arrivals. Indian traders have begun lifting the potatoes from the auction yard.
Rajesh Rai | Phuentsholing