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Indian farmers feel the heat of soaring pesticide pricesqrcode

Jul. 29, 2011

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Jul. 29, 2011

Though the south-west monsoon has been normal in many parts of the country, barring a few, farmers have raised concerns about high prices of pesticides and agrochemicals, which may rise further.

Prices of key insecticides and pesticides have increased 5-15 per cent over the past year and experts see prices rising further due to short supply. There is 10-15 per cent shortage in the total demand for select molecules.

The industry also attributes the rise in prices to an increase in the production cost, followed by the rise in crude oil prices. Farmers are facing a tough time due to a steep rise in the overall cost of production.

According to an estimate, the farm production cost has increased significantly and a rise in the pesticides and agrochemicals is believed to have put additional burden on farmers. “It is getting difficult to continue farming activities, as the input costs are rising sharply. The pesticides and other agrochemical prices have soared in the recent months. This year, the monsoon has already been late and high input costs are hurting farmers,” said Maganbhai Patel, president-Gujarat state, Bhartiya Kisan Sangh.

However, the industry argues that while agri commodity prices have increased, giving better returns to farmers for their produce, the increased pesticide prices would not affect farmers.

"The raw material prices have increased substantially. Crude oil prices are also high, making the raw materials for pesticides costlier. Manufacturers are not overpricing the pesticides. They are just passing on the cost burden to consumers and charging normal profits,” said R G Agarwal, group chairman, Dhanuka Agritech Ltd.

Going by the claims of industry sources, the generic agro-chemicals like weedicides, herbicides and pesticides, including cypermethrin, 2, 4-D amine, 2, 4-D ethyl ester and glyphosate are in short supply in the country and the imports from China are becoming costlier. A rise in prices of these generic agrochemicals would mainly affect paddy and cotton growing farmers.

According to industry experts, prices of pesticides may continue to rise until there is a substantial increase in domestic production. “Pesticide and agrochemicals demand is growing at about 10-15 per cent annually. The capacities are also growing but there are issues of raw material availability, which is causing prices to rise,” said a senior official from Gujarat State Fertilizer and Chemicals.

India has been importing the key raw material, organophosphorus compounds (OP compounds) from China. But due to short supply of the compound, Chinese suppliers have increased prices, making imports costlier.

"This year, the prices of insecticides and weedicides alone have increased by about 30 per cent over last year. There is no price control in this segment and the multi-national companies are charging at their will. Farmers are left with no choice but to buy costly agro-chemicals,” said Jaipal Reddy, secretary, Confederation of Kisan Organisations.

India’s agrochemicals and pesticides consumption is low in comparison with the developed world. While the US and Europe consume 2.5-3 kg of pesticides per hectare and Japan consumes 11 kg per hectare, India's is about 500 gms per hectare.

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