Slow demand to cause huge potato surplus

Cold storage operators have indicated that the 15 to 20 lakh tons of potatoes will remain unsold by the end of the year due to the slow demand for the vegetable.

Farmers and traders have retained 53 lakh tons of tubers in cold storage this year, up 32% from the previous year.

Only 10 percent of the tubers have been marketed since cold storage operators began to release potatoes, according to the Bangladesh Cold Storage Association (BCSA).

"This is very frustrating and alarming," said BCSA President Md Mosharaf Hossain, adding that the pace of marketing potatoes has been slow in the last month.

Only four months remain before the next harvest season, and at the current rate, huge quantities of potatoes will become surplus, said BCSA, an association of nearly 400 cold stores.

The concern comes from the fact that prices have risen from 28 percent to TK 20-25 per kg in the city of Dhaka compared to monthly prices, according to data from the Trading Corporation Of Bangladesh.

"Still, price increases are less than storage and other costs," Hossain said, adding that the cost of landing for potatoes at warehouses is 1,300-1,400 for each bag of 80 kilograms.

In contrast, potatoes are sold at Tk 850-1,000 each bag at cold storage doors.

The price gap between cold storage doors and retail level remains high as retailers sell potatoes by adding their operational costs, wastage and profits, Hossain said.

Storage capacity increased this year compared to last year and farmers and traders have stored more potatoes on the hope of generating higher profits during the lean season , According to the BCSA.

The association estimates that potato production was about 1 crore tons last season; The Bangladesh Bureau of Statistics (BBS) has yet to finalize the production figures for 2016-17.

During the fiscal year 2015-16, potato production was 94.74 lakh tonnes, according to BBS. With demand for vegetables remaining low, 45,000 tonnes of potatoes were exported in the first seven months of 2017, BCSA said.

"Under the circumstances, we want the government to take initiatives to boost the export and consumption of potatoes in the country," said Hossain.

The BCSA even wrote to the Prime Minister's Ministries, Food, Disaster Management, Agriculture and Trade last month to distribute potato as a relief among those affected By floods, as well as for social protection programs.

"This will help to clear the potato stored in cold stores, farmers will benefit, while cold storage owners will be able to repay the bank loans, otherwise potato production will drop, Next year, "said BCSA.

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