Syllabus: GS–III & V: Agriculture

Why in the news?

Potato growers in Sadiya, Assam, were seen dumping their produce on roads in protest after traders offered ₹7 per kg, far below the cost of production, even as retail prices hovered between ₹20–30 per kg. The episode highlights deep structural weaknesses in Assam’s potato value chain.

The core paradox

• Assam grows potatoes on around one lakh hectares, yet depends heavily on Uttar Pradesh, Bihar, and West Bengal to meet demand.
• Distress selling by local farmers coexists with high retail prices, indicating inefficiencies and skewed bargaining power in markets.
• Dependence on outside supplies exposes consumers to price volatility and hoarding, while local farmers remain underpaid.

Why farmers are losing out

• High input costs: Farmers spend ₹800–1,200 crore annually to procure nearly 75% of potato seeds from other states.
• Poor seed quality: Much of the seed stock consists of table potatoes, leading to low productivity and higher per-unit costs.
• Post-harvest vulnerability: Potatoes are perishable; lack of affordable, nearby cold storage forces immediate sale at throwaway prices.
• Fragmented marketing: Smallholders sell individually in unregulated markets, weakening price negotiation.

Policy pathways and existing support

• Seed self-reliance: Scaling up local production of high-quality seed potatoes can cut costs and lift yields. Assam’s “Potato Seed Production under Low Cost Net House”, supported by the World Bank, is a promising start.
• Cold storage access:
  • Under the Mission for Integrated Development of Horticulture, farmers, groups, cooperatives, FPOs, APMCs, and local bodies can receive 50% credit-linked subsidy in the Northeast for cold storages up to 5,000 MT.
  • The National Horticulture Board supports larger facilities (up to 20,000 MT) under capital investment subsidies.
• Collectivisation: Self-Help Groups and Farmer Producer Organizations can pool produce, access bank credit, negotiate storage rentals, and market collectively.
• Public cold storages: Panchayats and local bodies can build public facilities to offer affordable storage and moderate private rents.
• Linking processing: Buy-back arrangements with food processing units at pre-agreed prices can stabilise incomes and unlock finance.

Way forward

• Shift from subsistence to systems: Seed quality, storage, and collective marketing must advance together.
• Reduce volatility: Local storage and processing will smooth seasonal gluts and shortages.
• Empower farmers: Strong FPOs can convert state support into market power.

Exam Hook – Mains 

“Distress selling of potatoes in Assam reflects structural gaps in seed quality, storage, and market access. Discuss how farmer collectives and horticulture schemes can address this challenge.”

SOURCE