Stating that the general income of potato farmers growing the tuber for processing plants in Gujarat was a phenomenal figure of Rs 5 lakh per hectare, Sachid Madan, Chief Executive, fresh fruits and vegetables and frozen business, ITC, said these farmers earn double the income compared to their counterparts in other parts of the country. He was addressing the Global Potato Conclave on Tuesday.
“The general income of a farmer, if he is growing potatoes for processing units, is Rs 5 lakh a hectare. This is an unheard of number…If you are a good farmer, (there is) at least Rs 2.5 lakh an acre of tax-free income. If you are not a good farmer, maybe it is Rs 1 lakh…that is how farming gets revived and how people grow. When businesses are allowed to make money, why shouldn’t farmers be allowed to make money?” Madan stated.
Talking about farmer profitability, the official from ITC — that markets processed potato products under the brand Bingo — said the guaranteed way to double farmers’ income was to connect farmers to processes. “I have taken the prices for five years and barring one year, the price of processing potatoes has always been higher (than fresh potatoes). The yield is going up because everyone, including the farmers, is investing,” he said, as he compared prices of potatoes used for chip-stock in Gujarat with fresh potato prices in Agra, Uttar Pradesh.
While the prices of potatoes used for making chips in the processing units in Gujarat fetched between Rs 9.5-Rs 12.5 per kg, the fresh potatoes in Agra fetched between Rs 5.5-Rs 11 per kg between the years 2015 and 2019.
“Farmers make two times more income from growing potatoes for processing units,” he added. Gujarat has over 11 companies processing potatoes in the state. Compared to seven percent potatoes that are processed in the country, Gujarat processes 20 percent of its total potato production.
Madan also pointed out that the market size of potatoes in India has crossed Rs 50,000 crore with India exporting fresh potatoes to countries like Nepal, Maldives and Mauritius, and processed potatoes — which largely include french fries — to countries like Indonesia, Saudi Arabia, Kuwait and Oman.
From being an importer in 2007, India has exported over 30,000 MT (metric tonne) of the crop in 2019, said Haresh Karamchandani, CEO of Mehsana-based HyFun Foods, a potato processor in Gujarat. Haresh said that 2,000 potato farmers do contract farming for the company in over 10,000 acres in Gujarat. This makes for a sharp growth from 400 contract farmers (with 2,000 acres) associated with the company in 2017.
Chandubahi Virani of Balaji Wafers, one of the biggest potato chips brands in the state, said that his potato processing units in Gujarat employ 5,000 employees and operate a network of 1,500 suppliers in 11 states. He also narrated how his brand grew from an enterprise limited to selling hot chips from his home, to a Rs 600 crore-firm that sells potato chips via 10 lakh shops in the country.
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