India Cotton Farmers Distressed Due To Low Prices In Open Market

The cotton growers in Vidarbha region are once again in distress as prices of the cash crop were dropping below expectations in the open market.

Though the government has fixed the minimum support prices (MSP) at Rs3900 per quintal, prices in local market are far below expectations.

As compared to last year, the demand in the international market particularly China and Pakistan is virtually nil due to good crop there. This has resulted in less prices compared to last year when it rose to the higher side.

The Maharashtra State Cotton Marketing Federation which is bound to protect interest of farmers have so far not intervened in the price issue.

Moreover, this year the produce or the yield of cotton per acre has shrinked to about two quintal which is worrying farmers. This is the third year when they are facing the problem.

Though the Cotton Federation had announced they will open the procurement centres well before Diwali but they are still not in sight, sources close to cotton growers group said.

Huge losses are in store for cotton growers of the state this year too, said officials in Cotton Growers Co-operative Marketing Federation.

Farm activists too said crop losses would be anywhere between 25-50 per cent.

What is more perturbing is that despite poor crop, not only in the state but also in Gujarat this year, rates in open markets have remained stable around Rs 4,000 a quintal, they said.

"Cotton is always an unpredictable commodity. There are so many factors, from weather conditions, crop situation in other countries, international markets to the fickle nature of demand from industry. All these go into deciding the open market rates," explained a close aide of NP Hirani, Chairman of Cotton Federation.

He said the Federation has till date opened 92 procurement centres but managed to procure merely 788 quintal at the government price of around Rs 3,900.

"With market rates ruling around Rs 4,050, farmers prefer to sell to private traders to earn more," said Hirani.

For the first time this season he admitted that crop loss this year could be to the tune of 25 percent.

"Crop in our state is better that in some parts of Gujarat, where damage has been more widespread," he added.

While traders have bought 1.71 lakh quintals, the Cotton Corporation of India has procured only 1,500 quintals till date, Hirani claimed.

"The arrivals are low, indicating poor yields. At the start of the season, we were not expecting such a heavy loss.

Last year, we had a crop of 88 lakh bales in the state. This time it may be around 66 lakh bales," he said.

However, Kishore Tiwari of Vidarbha Jan Andolan Samiti (VJAS) told PTI that the state government has officially admitted that cotton yield is likely to dip by nearly 40 per cent because of Bt cotton failure in more than 4 million hectares .

"A report sent by the state agricultural department to the centre has estimated that the net direct economic loss to cotton farmers in the state will be nearly Rs6,000 crore, whereas accumulated losses are likely to cross more than Rs20,000 crore due to a steep rise in cultivation costs," said Tiwari.

"The government will have to intervene to bail out farmers . Last year, the state had given a relief package of Rs 2,000 crore to Vidarbha. But this year the losses are more. We demand a compensation of Rs 20,000 per hectare and fresh crop loans for every farmer for the ensuing kharif season."

"We also want food security and free health education, along with the implementation of land development, soil enrichment and watershed development under Mahatma Gandhi National Rural Employment Guarantee Act," he said.

The VJAS has threatened to take out a protest march of farmers to the Vidhan Sabha here on the opening day of the Winter Session of the Maharashtra Legislature on December 10.