Demand rise due to low production in India has driven up the prices

Chencho Dema

Punakha— The potato business is looking up this season, with demand soaring beyond the trends of the past two years, driving prices up in favour of potato farmers in the country.

The Food Corporation of Bhutan Limited (FCBL) has recently announced competitive prices: up to Nu 50 per kilogram for medium-sized, Nu 49 for small, and Nu 40 for large potatoes.

This spike in demand is particularly high for small and medium potatoes, which are sought after as seed stock in India.

The FCBL predicts this trend will continue until the end of October, creating a lucrative opportunity for farmers to capitalise on their harvest.

According to FCBL, the increased demand is largely attributed to lower potato production in India. “From mid-October to the end of November, Indian farmers actively seek potato seeds as it aligns with their planting season. Additionally, potatoes cultivated at higher altitudes tend to yield better results when grown in lower altitudes, contributing to the surge in demand for small and medium-sized potatoes,” an FCBL official said.

The annual potato auction, which kicked off on June 1, is slated to run until the second week of December. So far, the FCBL has auctioned 6,900 metric tonnes MT) from Phuentsholing auction yard.

Last year, around 878 farmers from Wangdue sold 8,875 MT of potato at the Phuentsholing auction, earning an average of Nu 15 per kilogram. This amounted to an annual income of Nu 133.129 million, excluding sales in local markets.

Several major potato-growing regions in Bhutan reported lower harvests in 2022. Wangdue, the highest potato-producing dzongkhag, harvested 10,323 MT, down by 583 MT from 2021.

Gangtey Gup Kinley Gyeltshen said that while farmers suffered losses last year, the prices this season are much more favourable. “The quality of this year’s potato is average, yet they are fetching good prices, likely due to higher demand,” he said.

The Gup said that production was lower this year, as potatoes in some areas were damaged by frost.

In a Facebook post, the FCBL has urged farmers to seize the moment, expediting their harvests and participating in auctions without delay, while advising against hoarding.

To support farmers, the FCBL established the Potato Trade Facilitation Centre in Gangtey, funded by GEF-LDCF, UNDP, FAO, and the Government of Bhutan, with a total investment of Nu 75.67 million. This facility offers essential services such as washing, drying, grading, sorting, and e-auctions, reducing costs and saving farmers time.

The Centre benefits farmers in Gangtey, Phobjikha, Sephu, and Rubesa.

“Farmers no longer need to grade and sort their potatoes in the fields, which previously required hiring a minimum of 15 labourers at a cost of Nu 7,500 per day,” a farmer said.

The centre charges only Nu 10 per bag for unloading, costing Nu. 1,500 per DCM truck.

Since its launch on September 2, 2024, the Gangtey Potato Trade Facilitation Centre has processed 850 MT of potato valued at Nu 26.7 million, with prices reaching up to Nu 4,000 per quintal.

The prices offered at Gangtey online auction are comparable, if not better, that offered in Phuentsholing. Farmers also fully save Nu 30,000 transportation cost per truck.

According to the 2023 crop data from gewog agriculture extension offices, Wangdue produces around 17,863 MT of potato annually, with an average yield of 6,548 kg per acre.

Phobjikha and Gangtey together represent around 1,500 acres—53 percent of Wangdue’s potato acreage and 17 percent of the national total. Combined together, they produce around 12,000 MT annually, accounting for 67 percent of Wangdue’s total potato output and 37 percent of the national yield.

Around 90 percent of the crop cultivated by over 1,000 farmers is sold at auctions in Phuentsholing. The total income from potato farming in Phobjikha and Gangtey comprise 29 percent of the national potato export value.

The Gangtey Centre has also reduced congestion at the Phuentsholing auction yard. Farmers no longer have to wait in long queues at the auction yard unlike previous years. 

The FCBL is planning to establish a similar Potato Trade Facilitation Centre in Bumthang next year, which will begin operations in the next auction season. This means Bumthang farmers will no longer need to transport their potatoes to the Phuentsholing auction yard.

Potato is grown dominantly in Paro, Chhukha, Wangdue, Bumthang, Mongar and Tashigang Dzongkhags.