Financial Express of India
Four years after the introduction of Bt cotton seeds, pricing has come to a critical juncture. Having absorbed costs every year, companies engaged in production and distribution of Bt cotton seeds have sought a 30 percent increase in prices of seeds in Andhra Pradesh. This amounts to revision of prices to Rs 850 and Rs 1,050 per packet for single and double gene technologies, respectively.
The prices, which are usually fixed by the state government, were at Rs 750 and Rs 925 per packet in 2006 and were further reduced to Rs 650 and Rs 750 per packet in 2008. With the season fast approaching, seed companies across the state are claiming that they would neither be in a position to supply adequate quantity this year nor take up any further production next year due to increases of around 35 percent in input costs and 31 percent in labour costs since 2006.
In a memorandum to the state government through the National Seed Association of India (NSAI), the companies hinted that production and supply of Bt cotton seeds might suffer if the proposed increase in prices does not materialise in this cropping season. Incidentally, area under production has come down from 45,000 acres to 15,000 acres owing to increased cost of inputs for seed growers.
Eventually, this could lead to an acute shortage of quality seeds for cotton growing farmers. NSAI has also mooted a government index such as the consumer price index-agricultural, which may be used to adjust prices of Bt cotton seed in future.
The state is also called the seed hub of the country producing more than 75 percent of total output. Due to price revision, the margins of seed companies are being hit by at least Rs 50-100 per packet. About 46 lakh packets are sold in the state.
(Story found in original format here.)