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Boom and bust: Corn’s rollercoaster ride in tribal country

The story of Nabarangpur’s emergence, and now decline, as a major maize producing hub.

Written by Harish Damodaran |
Updated: October 15, 2015 10:27:02 am
Trucks carrying eucalyptus clone plants. (Express Photo by: Kameswar Rao) Trucks carrying eucalyptus clone plants. (Express Photo by: Kameswar Rao)

Lakhichandra Bhatra raised hybrid maize in 30 acres in 2014 and in 60 acres the year before — much of it in so-called dangar or ‘encroached’ government wasteland.

This season, the 32-year-old 10th class pass Adivasi farmer from Tirilambaguda in Nabarangpur block has planted only 15 acres under Monsanto’s DKC 9126 and 9133 corn hybrids. That includes four acres of ‘own’ patta land and 11 acres of dangar land.

“There isn’t money any longer in maize. Last year, my average realisation was only Rs 950 per quintal, as against Rs 1,050 in 2013 and Rs 1,200 in 2012,” says Bhatra, who is also the sarpanch (elected head) of the Agnipur gram panchayat comprising 17 villages.

Lakhichandra Bhatra on his maize field. Lakhichandra Bhatra on his maize field.

But it isn’t just prices. Since 2012, the cost of a 50-kg di-ammonium phosphate (DAP) bag has shot up from Rs 800 to Rs 1,300, while rising from Rs 625 to Rs 1,000 for muriate of potash (MOP) and from Rs 260 to Rs 400 for urea. Daily wage rates, too, have doubled to Rs 200 for male and Rs 100 for female labourers during this period.

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Bhatra uses two bags each of DAP and urea, one bag of MOP and 10 kg of zinc sulphate for every acre, costing him upwards of Rs 5,000. Adding cost of seed (two 4-kg packets of Rs 1,000 each), tractor ploughing (Rs 2,000), sowing (Rs 1,500), weeding/interculture (Rs 1,500), harvesting (Rs 1,200) and shelling (Rs 500) takes the total to over Rs 13,500 per acre.

WATCH VIDEO: Why Is Nabrangpur District Zero?

“My average yield is 20 quintals per acre. Even taking 25 quintals, my net return at Rs 950 is barely Rs 10,000/acre. It was much more when maize prices were higher, and fertiliser and labour costs lower,” notes Bhatra.

Freshly planted eucalyptus saplings on maize fields. Freshly planted eucalyptus saplings on maize fields.

He is relatively better placed though. Temraj Bhatra — who can’t afford high-input agriculture and gets only 10 quintal/acre yields —has kept his five-acre land fallow after losing Rs 30,000 in maize cultivation last year: “I thought it better to do construction work in Nabarangpur”.

These stories of farmers exiting maize one repeatedly hears while travelling through Nabarangpur’s interiors. Rajendra Singh farms paddy on seven acres that he owns in Mahendri village of Papadahandi block. Last year, he also grew hybrid maize on 40 acres of dangar land, leased in at Rs 3,000-3,500/acre from various encroacher-owners. This year, Singh has reduced his maize area to 5 acres. That he wasn’t the only one is reflected in lease rents on dangar lands dropping to Rs 500 per acre levels.

Maize represents the classic case of a commercial crop that even farmers in India’s poorest and predominantly Adivasi district enthusiastically planted when prices rode on the back of a global commodity boom. As realisations virtually trebled between 2005 and 2012, Nabarangpur emerged as Odisha’s main producing centre, with large quantities of its grain being dispatched through railway rake points at Jeypore (Koraput) and Kesinga (Kalahandi) or even exported out of Kakinada and Visakhapatnam ports.

The district also became a market for multinational seed majors. In 2013 — when acreage peaked at 63,882 hectares — an estimated 1,300-1,400 tonnes of hybrid maize seeds worth about Rs 25 crore got sold in Nabarangpur, roughly 85 per cent of it by Monsanto and DuPont-Pioneer. Alongside, a roaring business of extending credit to farmers for input purchase — typically at 3 per cent interest per month — developed. The small retailers who undertook such financing, in turn, obtained their funds or agri inputs through a chain of larger dealers and distributors.

“We even financed their labour and other cultivation expenses. The farmer had to only manage his field and deliver the harvested maize to us. This crop we ourselves sold to traders and made the payment to him after deducting interest on the credit extended,” explains Biswanath Das, a retailer at Maidalpur in Papadahandi block.

According to Rajendra Singh, while subsidised credit from the local cooperative institutions cost just 2 per cent per annum, it was available only for paddy cultivation on patta land and not for maize — which was largely being grown on encroached revenue or forest land. Farmers, therefore, had to rely entirely on retailers for their working capital requirement of Rs 12,000-13,000 per acre.

It is this complex credit and produce buyback system that has collapsed. “While prices are a major reason, there was also the damage caused to last year’s crop by continuous rains and cyclone Hudhud in October. Both together led to widespread farmer defaults and, as a result, trade finance for maize cultivation has practically stopped,” points out Rajesh Kumar Agrawal, a large retailer in Papadahandi town.

In 2014, Nabarangpur’s maize area fell marginally to 62,150 hectares. This year, a mere 38,521 hectares got sown, with hybrid seed sales also declining to 650-700 tonnes. At its peak, when annual production was

2.5 lakh tonnes and prices averaged Rs 1,200 per quintal, maize contributed roughly Rs 300 crore of revenues to Nabarangpur’s farmers. That would have since contracted to less than a half.

The story does not, however, end there. In the last one year, large areas of dangar lands where maize was being grown have gone to nilgiri (eucalyptus). In Tirilambaguda alone, Lakhichandra Bhatra and his fellow villagers have planted over 100 acres with eucalyptus saplings. These are being supplied by nearby wood pulp user industries like Mangalam Timber Products at Nabarangpur, Bilt paper mill at Jeypore and JK Paper at Rayagada. Trucks carrying eucalyptus clone plants are, in fact, a common sight today in Nabarangpur.

Sushil Haldar, deputy director of Agriculture in Nabarangpur, estimates about 15,000 hectares to have been planted to eucalyptus this year: “The overall acreage diversion from maize would be more, as we did not undertake any survey of plantings last year”.

While the environmental implications of this are not clear, it certainly isn’t good news for seed or tractor firms. “My sales are 50 per cent down compared to three years ago. Also, my buyers are wholly contractors and builders, not farmers. Nilgiri cannot give me the business that the maize economy did,” observes Ravi Sankar Agrawal, a John Deere tractor dealer in Umerkote town.

As regards farmers, Bhatra is hopeful that the eucalyptus saplings would yield 10-15 tonnes of wood per acre after five years and 15-20 tonnes in three years thereafter. At about Rs 3,500 per tonne and total cultivation cost of Rs 16,000 or so, that should guarantee reasonable returns. What would happen to prices when all the nilgiri plantations start yielding pulp is, of course, another matter.

Rajesh Kumar Agrawal does not foresee maize making a comeback in the immediate future. “Unlike paddy, there is no assured procurement or minimum support price for maize. Unfortunately, we have no feed mills, processing plants or even large poultry farms that can provide a ready market for our maize,” he points out.

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