LAHORE: Potato prices which crashed two weeks ago as harvesting began and are still witnessing a low trend throughout the province with no sign of improvement at least during this month, farmers from central Punjab fear.

On Monday, small potatoes were traded for Rs500 per 100kg bag (or Rs5 per kg) and bigger ones fetched up to Rs800 for a 100kg bag (or Rs8 per kg).

Farmers from Okara region, commonly known as the potato belt in Pakistan, say their per kg production cost is Rs12.

According to them, the Punjab government has got all its statistics about the yield, marketing and pricing wrong. Its claims of a bumper crop and price improving after mid-February when exports pick up pace also sound hollow.

“Since the government got its basic statistics wrong, the corrective measures, if any, cannot help the crop or growers,” explains Rao Azhar, a doctor-turned-progressive potato grower.

He further said exports have never affected domestic price, nor would they this year either for three reasons. The exports do not go beyond half a million tonne, which hardly constitutes seven to eight per cent of the total production (hovering above six million tonne) and 17pc to 18pc of the total tradable surplus, which is above three million tonne. This meagre quantity can hardly impact prices in domestic trade. Moreover, currency devolution in export market and liquidity crunch among Pakistani exporters are keeping, and probably would keep, the price down this year, he added.

“Currencies in Central Asian states have lost value against dollar, making imports expensive for these markets. This is turning out to be a huge hurdle for Pakistani potato. On top of that, Pakistani exports lost a lot of money last year because of domestic price crash, loss of traditional markets and snapped supplies in those markets got their payments stuck there. They are experiencing cash starvation this season and are unable to make meaningful purchases for export. So, to the misfortune of farmers, the official hope of exports improving the domestic price may not materialise,” Rao concluded.

“Farmers, however, have a glimmer of hope, albeit for limited improvement next month as flow to the market would be reduced by late attack of blight on the crop and a new phenomenon known as Brown Spot also affecting the yield,” says another farmer from Okara.

Both diseases would also belie official claims of a bumper crop as yield would be cut by at least 20pc– as compared to the last year. The slight improvement in price would thus be neutralised by a drop in yield, leaving farmers with little margin of survival, he feared.

The only option for the government is pushing exports through some freight subsidy, which would bring the cost of export down and trigger trade activity within the country. Only then could exporters spare some additional, however meagre, money for farmers. Otherwise, the glut would only cumulate, press the price further down and make life even harder for farmers, he warned.

Published in Dawn, February 9th, 2016