Federation of Seed Industry of India’s statement on Cotton Seed Price
Delhi: We are happy with the increase of 5% in cotton seed price as announced by the Government of India. This is less than the 10% we requested for, but we consider it as a good gesture by the Government.
We represented to the Government of India that the cotton seed business was becoming unviable for the industry and research investments in developing new hybrids has dwindled significantly. If this is not corrected immediately it will adversely affect cotton yields and farmers profitability.
Mr Ram Kaundinya, Director General, Federation of Seed Industry of India and Alliance for Agri Innovation said, “We are glad that the government has seen merit in our arguments and agreed for a 5% price increase. The textile industry has aggressive plans to grow their industry in this decade. Cotton production has to go to 5.7cr bales by 2027 from the current level of 3.7 cr bales. It is not possible unless we upgrade the technology in seed. Cotton yield and production has stagnated due to declining investment in breeding and lack of new technology introduction. India’s pre-eminent position in global cotton markets is in danger of being lost. India is losing competitiveness with plateauing yield, declining farmer profits & export volume, allowing other countries to gain share in the international market. Since 2011 Indian cotton export volumes came down by 70% while Brazil increased by 80% and Africa increased by 116% during the same period. Backed by modern technologies the cotton farmers of African countries and Brazil are on the path of increasing their export volumes.”
“Cost of seed production is increasing continuously. The cost of inputs such as labour, fertilizer and crop protection have also gone up significantly. For example, the cost of labour employed in the field costs more than Rs 75000/ per acre for the emasculation and crossing needed for hybridization. The cost of fertilizer has increased by 30% and the cost of crop protection has been increasing due to falling rupee against the US dollar. The situation has been made worse this year due to the pandemic as labour availability was very erratic and expensive. On the other hand, the MRP of BGII cotton has not kept pace with the cost increases. It has been reduced from Rs 800 to Rs 730 over the last 5 years, out of which the seed component (excluding the trait value) moved down from Rs. 751 per packet to Rs. 730 per packet.”
We now feel encouraged by the price increase and would like to thank the Government for this gesture. In the long-term, interests of the industry and for the farmer, we urge the Government to remove the price control completely. This will encourage more investments to flow into introduction of modern technologies and seed varieties into the market, which is crucial for the health of Indian cotton industry and the Indian cotton farmer.